Lombard, IL Retirement Account Division Lawyers

Trusted Attorneys Helping Divorcing Spouses Divide Retirement Accounts and Pensions in Lombard, Illinois

During the divorce process, you will need to address a variety of financial concerns. As you take steps to gain a full understanding of the assets you own, you will need to make decisions about property division. Some important decisions to make during this process will be related to how different types of retirement assets will be divided.

Retirement benefits such as 401(k) accounts, IRAs, and pensions may represent a significant portion of the assets you have acquired during your marriage. Failing to properly value and divide these assets can have long-term consequences. The loss of certain assets could jeopardize your future financial security, putting your plans for retirement on hold or limiting your future opportunities. Careful planning and skilled legal guidance are essential as you address retirement accounts and determine how to protect your financial interests.

At A. Traub & Associates, our experienced divorce attorneys can help you understand your rights regarding retirement assets. We will work closely with you to develop strategies that will help you protect your financial future. We can take steps to identify and value retirement benefits, and we will make sure the right steps are taken to divide your marital property correctly.

Addressing Retirement Assets During Your Divorce

When you get a divorce in Illinois, you and your spouse will need to take steps to ensure that your assets and debts are divided fairly and equitably. Retirement benefits that either you or your spouse earned during your marriage will be part of the marital estate, even if only one spouse's name is on the account. These assets can represent decades of work and saving, and determining how to divide them correctly can help you protect your future financial stability.

By taking the right steps to evaluate and divide retirement benefits during your divorce, you can minimize disputes over financial issues while making sure both you and your spouse will have the financial resources you will need during retirement. Our attorneys can help you understand the steps you can take to avoid or minimize tax consequences and ensure that these assets will be divided correctly.

Types of Retirement Benefits to Address During Divorce

Depending on what types of retirement accounts you and your spouse have, you may need to take different steps to make sure they will be divided fairly. Some common types of retirement benefits include:

• 401(k) Accounts and Similar Employer-Sponsored Plans: These defined contribution plans can be divided between spouses, but care must be taken to avoid early withdrawal penalties or tax consequences.
• Individual Retirement Accounts (IRAs): These accounts may be divided through a process called a transfer incident to divorce, which allows funds to be moved from one spouse's account to another without triggering taxes.
• Pension Plans: Pensions are defined benefit plans that may provide monthly payments after a person retires. A person's ex-spouse may be entitled to receive a percentage of these benefits, and this percentage will depend on how long the pension holder earned benefits while they were married.

There are multiple options for dividing retirement benefits. In some cases, spouses may decide to split accounts equally, while in others, one spouse may maintain ownership of certain benefits, while the other spouse will receive other marital assets. Our attorneys can help you negotiate agreements that will protect your financial interests and ensure that you will be able to retire successfully in the future.

Qualified Domestic Relations Orders

When dividing 401(k) accounts or allocating pension benefits between spouses, a Qualified Domestic Relations Order (QDRO) may be used to ensure that these issues will be handled correctly. A QDRO is a court order that provides instructions for the administrator of a retirement plan on how to distribute benefits to an alternate payee.

A properly drafted QDRO will avoid the tax liabilities and penalties for early withdrawal that would typically apply if funds are withdrawn from a retirement account before the account holder is eligible to retire. A QDRO will provide specific instructions, which may include a fixed dollar amount or a percentage of funds that will be allocated to the account holder's ex-spouse.

Drafting and implementing a QDRO requires attention to detail and knowledge of the specific laws that apply to different types of accounts. Errors or mistakes could delay the division of assets, or they could lead to financial losses. At A. Traub & Associates, we can help ensure that QDROs are created and filed correctly so that you will be able to avoid any concerns that could affect the division of retirement assets.

Contact Our Lombard, Illinois Retirement Asset Division Attorneys

During your divorce, retirement benefits are only one of the many issues that you will need to address as you negotiate agreements related to the division of marital assets. The attorneys at A. Traub & Associates will advise you on the best steps you can take to prepare for the future, and we will advocate for solutions that will provide you with peace of mind as you move forward following your divorce. Contact our Lombard division of retirement benefits lawyers today at 630-426-0196 to arrange a consultation.