Maybrook Divorce Attorney for Pensions and 401(k) Division

Lawyers Assisting With the Division of Retirement Accounts in Oak Park and Chicago

When getting a divorce, struggling to manage the avalanche of legal, personal, and financial concerns that will need to be resolved can be overwhelming. During this time, it is important to pay attention to your immediate concerns, but also to take steps to meet your needs in the future. If you or your spouse own assets such as retirement funds or pension benefits, a skilled lawyer can help you determine how to divide this property during your divorce.

The family law attorneys of Wakenight & Associates, P.C. have over 95 years of combined legal experience, and we know how to approach the complex issues involved in a high net worth divorce. We will work to protect your rights when dividing marital assets and ensure that you will have the resources you need to prepare for your retirement.

Dividing 401(k)s, IRAs, and Pensions

Under Illinois law, all marital property acquired during a couple's marriage is subject to fair and equitable division during divorce, regardless of whether it is owned jointly or is in one spouse's name. 401(k) or IRA accounts and pension benefits are considered marital assets, and they may be split between spouses, or they may remain under the ownership of one spouse if the other spouse receives assets of an equivalent value.

In many cases, understanding the value of a retirement account is fairly straightforward, since it will have a known balance. However, if one spouse began contributing to an account before getting married, the marital portion of this asset may depend on its balance prior to getting married and the amount contributed during the marriage.

Determining how to divide pension benefits can be more complicated, since these deferred benefit plans will typically not realize their full value until the time of a spouse's retirement. At that date, the beneficiary will be eligible to receive regular payments based on the number of years they worked and the income they earned at the age of retirement. The pension holder's ex-spouse may be entitled to receive a portion of these payments based on the number of years the couple was married while the beneficiary spouse worked in a pension-eligible position.

Qualified Domestic Relations Orders

Divorcing spouses should be aware that the early withdrawal of funds from retirement accounts can result in penalties and taxes. In order to avoid these penalties, a Qualified Domestic Relations Order (QDRO) should be created to specify the amount(s) a spouse is entitled to receive from their former partner's account(s). In most cases, the spouse will then be able to roll this amount over into their own retirement plan.

A QDRO should also be used to allocate pension benefits between divorcing spouses. The QDRO will state the percentage of benefits that should be allocated to the pension holder's ex-spouse when the benefits are paid out following retirement.

Contact a Cook County QDRO Attorney

Our lawyers can help you make decisions that will allow you to maintain financial security both immediately after your divorce and in the years to come. We can also help you address tax considerations and other complex issues in your divorce case, ensuring that your rights and interests are protected throughout the legal process. Contact us today at 708-480-9651 to set up a free initial consultation. We serve clients in Oak Park, Chicago, Maybrook, Riverside, Forest Park, Berwyn, Elmwood Park, Cicero, Skokie, River Forest, and Cook County.