Law Office Of William B Bennett, St. Petersburg, FL, Pensions During A Divorce

Does Divorce Affect A Pension?

A pension accrued during marriage is generally treated as a marital asset and divided equitably in a Florida divorce. It can still be distributed even if the plan is only in one spouse’s name. Only the portion earned during marriage is subject to division. However, special rules and orders can apply to finalize the transfer. Here’s what couples in St. Petersburg, Tampa, and Clearwater may want to know about Florida law and the process for distributing pensions during a divorce case.

The Basics of Pension Division in Florida

Under Florida law, any funds or benefits accrued in a pension during the marriage can be considered marital property. This can include state government and private plans: the portion of a pension earned before marriage is treated as separate property and won’t be divided. Florida follows “equitable distribution”. This means assets are divided fairly, but not always equally. Courts look at many factors including the length of the marriage, each spouse’s financial situation, and contributions to the marriage, both financial and non-financial.

How Courts Divide Pensions During A Divorce

  • Only the marital portion of the pension (accrued during marriage) is subject to division. Pre-marital and post-divorce accruals stay with the plan holder.
  • Factors considered include length of marriage, each spouse’s economic circumstances, and contributions to any marital assets.
  • Pensions are rarely split 50/50; the court aims for a fair result based on the total marriage context.

The Role of the QDRO

Florida courts require a Qualified Domestic Relations Order (QDRO) to divide qualified pensions and retirement plans. This legal document spells out the percentage or amount each spouse receives and directs the plan administrator to make payments accordingly. If handled correctly, a QDRO allows pensions to be transferred without incurring early withdrawal penalties or creating taxable events under federal law.

Tax Considerations

  • Early distribution without a QDRO may trigger a 10% IRS penalty.
  • With a QDRO, transfers are generally penalty-free, but each spouse should seek tax advice before electing lump-sum or rollover options.

Social Security Benefits

If a marriage lasted over 10 years, a spouse may be eligible for Social Security benefits based on the former partner’s work history under certain conditions. This is separate from pension division but relevant to post-divorce financial planning.

Protecting Your Interests

Valuing a pension can require expert financial analysis, subpoenas and legal documentation. Survivor benefits and future distributions also play a role during division negotiations. The counsel of an experienced family law attorney can help guide the process.

Handling Pensions During A Divorce Can Be Complicated. The Law Office of William B. Bennett Can Help.

If you have questions about dividing pensions or retirement plans in divorce, contact The Law Office of William B. Bennett. Expert legal guidance ensures that your rights, assets and financial future are protected throughout this complex process. Call (727) 821-8000 for a free consultation or contact us on our website here.

Tagged with: , , , , , ,

Posted in: Divorce

«