Division of Pension in Divorce

Am I Entitled to a Portion of My Spouse's Pension in a Maryland Divorce?

Divorce can be a complex and emotionally taxing process, especially when it comes to dividing assets. One of the most significant assets in many marriages is the pension plan. If you are going through a divorce in Maryland, you might be wondering whether you are entitled to a portion of your spouse’s pension. Here’s what you need to know about how pensions are handled in a Maryland divorce.

Understanding Marital Property:

In Maryland, property acquired during the marriage is considered "marital property," regardless of whose name is on the title. This includes:

• Real Estate

• Vehicles

• Bank Accounts

• Investment Accounts

• Retirement Plans and Pensions

However, property acquired before the marriage or by inheritance or gift from a third party is generally considered "separate property" and is not subject to division in a divorce.

Pensions as Marital Property

Pensions, like other retirement benefits, are considered marital property if they were earned during the marriage. This means that any portion of the pension accrued during the marriage is subject to division upon divorce. The division of a pension can be complex and often requires specific legal steps.

How Pensions Are Divided in Maryland

Equitable Distribution:

Maryland follows the principle of equitable distribution. This means that marital property is divided fairly, but not necessarily equally. The court considers several factors to determine what is fair, including:

• The length of the marriage

• The age and health of each spouse

• Any agreement between the parties

• The value of all property interests of each spouse

• The economic circumstances of each spouse at the time of the divorce

• The contributions of each spouse to the marriage, both financial and non-financial

  Qualified Domestic Relations Order (QDRO)

To divide a pension plan, a Qualified Domestic Relations Order (QDRO) is often required. A QDRO is a legal order that recognizes the right of the spouse to receive a portion of the pension benefits. It must be approved by the court and the pension plan administrator. The QDRO specifies how the pension will be divided and ensures that the plan administrator pays the ex-spouse directly.

Steps to Divide a Pension:

1. Identify the Pension: The first step is to identify the pension, and review the plan documents to determine the various aspects of the pension, such as when pay status begins, and how payments will be made.

2. Determine Division of the Pension: Commonly, the marital share of the pension is divided equally. Spouses can negotiate a settlement agreement that outlines how the pension (and other marital assets) will be divided. This agreement can be included in the divorce decree.

3. Draft the QDRO: An attorney or QDRO specialist drafts the QDRO according to the terms of the settlement agreement and the requirements of the pension plan.

4. Court Approval: The QDRO is submitted to the court for approval. Once approved, it becomes part of the divorce decree.

5. Plan Administrator Approval: The approved QDRO is sent to the pension plan administrator for review and implementation. The plan administrator will ensure that the QDRO complies with the plan’s rules and federal law.

Considerations for Dividing a Pension:

When dividing a pension, it’s important to consider Survivor Benefits. This guarantees that you will continue to receive benefits if your ex-spouse dies before you.

Conclusion:

In Maryland, you are entitled to a portion of your spouse’s pension if it was earned during the marriage. If you are facing a divorce and have questions about dividing a pension, consulting with an experienced family law attorney at Markham Law Firm can provide valuable guidance and support throughout the process. Call our office at 240-396-4373 or click here to contact us to discuss your specific case needs.