Although they once may have been benefits reserved for executives and government or union employees, pensions and other retirement plans are now commonplace throughout the Mississippi workforce.
In other words, many people who live in Gulfport and the surrounding areas may have a retirement plan even if they are not especially wealthy. Public employees and those who belong to unions may still be entitled to retirement pensions, and many others may have saved money in a 401(k) or similar plan.
Like other property, retirements plans are subject to division in a divorce.
To explain, a Mississippi court will consider a retirement plan marital property subject to some exceptions. Under Mississippi law, marital property is subject to an equitable division. In practice, this means a judge should divide retirement plans fairly if not perfectly equally.
Any couple in the Gulfport area may have to deal with dividing a retirement plan
Dividing a retirement plan in a divorce is not easy. For one, the couple may disagree on whether any or a part of the retirement plan is marital property.
For example, the person who holds the plan may argue he or she should get to keep that portion which he or she acquired before the marriage or after the split.
Particularly in the case of pensions, there may also be some dispute about how much a retirement plan is worth. One or both parties may have to call a financial expert to explain the value of a person’s retirement plan.
Finally, because of federal tax laws, the couple will have to be careful when actually dividing up the plan. Sometimes, it may make more sense for the person holding the plan to offer to trade other property so as to keep the plan outright without having to divide it.
If the couple does want to divide the plan, one of them will have to prepare a qualified domestic relations order, or QDRO, and submit it to the plan’s administrator.
A QDRO must be prepared correctly or there could be delays in the divorce process. The fallout from a serious error could be an unintended division or property or adverse tax consequences.