Utah Retirement and pension plans may include defined benefit plans, defined contribution plans, 401(k) plans, state and federal government retirement or pension plans, private employer benefits, and some military retirement benefits. Typically anything paid into the plan during the marriage is considered marital property. Your Pearson Law Firm Utah divorce attorney can help you if you have additional questions not covered below.
If both spouses have their own Utah retirement plan, then the court prefers that each spouse take his or her own retirement plan. If there is a large discrepancy in the size of the plans, or one of the spouses does not have a retirement plan, then Utah courts often attempt to make up the difference by awarding something of equal value to the non-contributing spouse, such as additional equity from a home, etc. If there are no other assets or funds to award, then the retirement plan may have to be split.
As is always the case, the parties can agree as to how to divide property, including retirement accounts. If the parties cannot agree then the court will usually divide the retirement account using the Woodward Formula, which was established in the Utah Supreme Court Case of Woodward v. Woodward, 656 P.2d 431 (Utah 1982). The formula is as follows: multiply one-half of the value of the account by the number of years the parties were married and divide by the number of years the employee has worked. For example, if the account value is $60,000 and the parties were married for 10 years and the husband worked for 13 years, the wife’ s share would be $23,076:
$60,000 x 1/2 = $30,000
$30,000 x 10 = $300,000
$300,000 / 13 = $23,076
Once the amount is determined, one of the parties (typically the receiving party) must obtain a Qualified Domestic Relations Order, or QDRO. The QDRO must be signed by a judge, and then submitted to the plan administrator. The plan administrator will divide the account or pay the benefits based on the terms in the QDRO.
The division of a retirement plan can be confusing, and typically the QDRO is not included as part of your Utah divorce representation. Contact Pearson Law Firm for a free consultation with a Utah divorce attorney that is experienced with this type of issue. Call today, 801-888-0991.