When you file for divorce in Texas, you will have to learn a lot of new words and phrases. Learning about community property, for example, will help you understand what assets are subject to division in your divorce and how the courts will probably split your property.
The more assets and debts that you share with your spouse, the more complex dividing your community property will become. Some people will need to use a special legal document called a QDRO as part of the property division process in their divorce.
What exactly is a QDRO?
The acronym QDRO stands for Qualified Domestic Relations Order. This is a special document typically drafted by one of the attorneys involved in a divorce that orders the division of retirement savings or pension accounts. They will use the terms set in the settlement agreement between spouses or the property division order entered by the judge to compose the document.
The court then has to approve the QDRO by verifying that it reflects the ruling or settlement. Once the court approves it, the QDRO is ready. The goal of creating a QDRO is to submit it to the person or business that manages the retirement accounts that the couple needs to split in their divorce. When executed properly, a QDRO allows for the division of retirement accounts after a divorce without financial penalties for the early withdrawal of retirement savings.
Determining whether any of your pension or retirement savings will be community property in your upcoming divorce can help you determine if you need a QDRO to help with the property division process.