Division of Retirement Funds in Divorce
Many people contribute to retirement funds throughout their careers with the expectation that such funds will be available to support them when they no longer work. When married couples divorce, however, some or all of their retirement funds are often considered community property and are subject to division as the court deems appropriate. If you or your spouse wish to end your marriage and you have questions about how the division of retirement funds in divorce can impact your financial health, it is wise to talk to an attorney. The strategic Dallas divorce attorneys of McClure Law Group are skilled at helping people safeguard their interests in dissolution proceedings, and if we represent you, we will fight to help you seek a just outcome.The Texas Courts’ Treatment of Property in Divorce Cases
Texas is a community-property state, which means that any property either spouse acquires during the marriage is considered to belong equally to both parties. Property includes real estate, income, and retirement funds. It does not include any assets expressly designated as separate property via a marital or prenuptial agreement, damages awarded for personal injuries that do not represent lost wages, gifts, and property obtained via descent or devise. Pursuant to the Texas Family Code (the “Code”), the courts will divide any community property in a way that they deem just and right in divorce actions, while the separate property of each spouse will generally remain separate.Division of Retirement Funds in Divorce
Retirement funds generally include money contributed to 401(k) and 403(b) accounts, IRAs, and other retirement plans, pensions, and deferred compensation accounts. If all of the contributions in a retirement account were made or accrued after the date of marriage, they will likely be considered the community property of both spouses, regardless of whose name is on the account or whose income contributed to the account. Conversely, if the funds in an account were deposited before the date of marriage, they will be deemed separate funds. As many people start retirement funds prior to getting married and contribute to them throughout their marriage, such funds typically include both separate and community property. Thus, the division of retirement funds can be challenging in Texas divorces. In many instances, the parties will need to retain forensic accountants and other experts to offer testimony regarding the portion of the retirement funds that represents community property and the value of the separate and community property, respectively.
Retirement funds in accounts like 401(k)s and IRAs are divisible in divorce actions, regardless of how long the marriage endured or when the retirement benefits can be withdrawn. The Code expressly states that when issuing divorce decrees, the courts must determine the rights of both spouses in retirement accounts. Typically, the court will issue a Qualified Domestic Relations Order, or QDRO, which is an order separate from the divorce decree that directs your former spouse’s employer to divide their retirement benefits in the manner set forth in the decree. Pensions, military retirement benefits, and Social Security spousal benefits have different rules regarding eligibility and when they may be recovered.Confer with a Skillful Dallas Attorney Today
The Texas courts have the authority to divide community property, including retirement benefits, in a right and just manner in divorce actions. If you or your spouse want to end your marriage, you should speak to an attorney about what to expect with regard to the division of retirement funds in divorce. The skillful Dallas lawyers of McClure Law Group have ample experience litigating divorce actions, and if you hire us, we will craft persuasive arguments on your behalf to provide you with a strong chance of achieving a favorable result. Our principal office is in Dallas, and we are available to meet clients for conferences at our Collin-County office in Plano. We frequently represent parties in divorce matters in Dallas, Rockwall, Fort Worth, McKinney, Richardson, Frisco, Garland, and Irving. We also represent people in family-law cases in cities in Dallas, Denton, Collin, Tarrant, Rockwall, and Grayson Counties. You can reach us by calling us at 214.692.8200 or using our online form to set up a confidential consultation.