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VCERA DROs: Dividing Ventura County Employees’ Retirement Association Benefits in Divorce

by Madeline Hill | Nov 28, 2012 | Defined Contribution Plans, General QDRO Info, VCERA - Ventura County

VCERA & DIVORCE – GENERAL INFORMATION

Employees of Ventura County are members of the Ventura County Employees’ Retirement Association (VCERA). Like other money or assets acquired during marriage, VCERA benefits are subject to division during divorce. The division of these benefits is accomplished by a special court order called a Domestic Relations Order or DRO.

VCERA JOINDER REQUIREMENT

Joinder is a legal process that names a third-party claimant to the parties’ divorce case. In order for VCERA to respond to a DRO, a joinder must be filed and served on the plan. Joinder is the first step in obtaining an Order to divide Ventura County Employees’ Retirement Association benefits. Your divorce attorney may have already filed a joinder for you; however, if needed, QDRO Helper also offers joinder services.

DIVISION OF BENEFITS

Typically, the nonmember spouse is awarded one-half of the community property interest in the retirement benefits. There are two basic methods of division: i) a segregation of account method, where a separate account will be established by VCERA on behalf of the nonmember and ii) a shared method, where the nonmember spouse receives a portion of each payment made to the member. The shared method is the only option that can be utilized if the member has already retired. If the member is not retired, either the segregation method or shared method can be used. Under the segregation method, the nonmember has a variety of distribution options:

he/she may request a refund of contributions and interest (which can be “rolled over” into another qualifying plan), or
he/she can commence receipt of a monthly retirement benefit if eligible, or
he/she may maintain the account by electing a deferred retirement until such time as he/she elects either a refund of contributions and interest or becomes eligible to receive a monthly retirement benefit.

If a member is not vested, then the nonmember spouse can only utilize option 1 above. When the nonmember is paid a refund, the member will have five years to sign a contract that will allow the member to redeposit all contributions withdrawn, plus interest, in order to regain the service credit awarded and paid out to the nonmember spouse. The contract may be satisfied with payroll deductions over the course of five consecutive years (one hundred and thirty consecutive biweekly payments).

NONMEMBER’S DEATH

The nonmember spouse has the right to name a beneficiary, or beneficiaries, for the nonmember’s VCERA benefits. If the nonmember dies before the effective date of retirement, his/her accumulated contributions shall be paid to his/her designated beneficiary.

If the nonmember dies after the effective date of his/her retirement, if the total retirement allowance income received by the nonmember during his/her lifetime was less than his/her accumulated contributions, his/her designated beneficiary shall be paid in one lump-sum the difference between the total contributions and the total retirement allowance income.

QUESTIONS ABOUT VCERA DROs?

If you have questions about the division of VCERA benefits, or if you would like to get started on your Domestic Relations Order today, please call QDRO Helper at (619) 786-QDRO / (619) 786-7376. We proudly serve clients throughout California – no in-office appointments required. You can also view VCERA’s comprehensive divorce booklet here.

DISCLAIMER: Any legal information on this blog has been prepared by QDRO Helper for informational purposes only and should not be construed as legal advice. The material posted on this website is not intended to create, and receipt of it does not constitute, an attorney-client relationship, and readers should not act upon it without seeking professional counsel. Note also that sending an e-mail to QDRO Helper does not create an attorney-client relationship, and none will be formed unless there is an express agreement between the firm and the individual. We strongly advise against sending confidential or privileged information to QDRO Helper until you can establish such a relationship.

San Luis Obispo County Pension Trust & Divorce

by Madeline Hill | Nov 14, 2012 | General QDRO Info, Public Employee Plans, SLO County Pension Trust

Every permanent employee of San Luis Obispo County is required to become a member of the San Luis Obispo County Pension Trust. Each member contributes a percentage of his/her salary to the Pension Trust; members can also make voluntary contributions. The employer also contributes a percentage of each member’s salary to the Pension Trust. Contributions made to the Pension Trust during marriage are considered community property and are subject to division under California law due to divorce or legal separation. The court order used to divide these retirement benefits is called a Domestic Relations Order or DRO. Under the DRO, the employee is called the “member” and the non-employee former spouse is called the “Alternate Payee”.

JOINDER REQUIREMENT FOR SLO COUNTY PENSION TRUST

The San Luis Obispo County Pension Trust must be joined before a DRO can be implemented. Joinder is a legal process that names a third-party claimant to a divorce case; the Pension Trust is a third-party claimant to any dissolution case which involves San Luis Obispo County Pension Trust benefits. The joinder will put the Plan on notice of the pending dissolution action and forthcoming DRO, and will give the court jurisdiction over the SLO County Pension Trust. Often divorce attorneys file the joinder as part of the dissolution proceedings. However, if needed, QDRO Helper can file the necessary joinder documents for you for an additional fee .

METHODS OF DIVISION

There are two basic methods utilized for dividing San Luis Obispo County Pension Trust benefits for active or reserve members. There is only one option for dividing the benefits of a member who has already retired. The methods of division are described below.

Method 1: Payout of the Alternate Payee’s Share at the Time the Member Retires or Dies

Under the first method of division, the Alternate Payee will receive a portion of each payment made to the member, or upon the member’s death, based upon his/her community property interest. Payments will only commence to the Alternate Payee either 1) upon the Member’s actual retirement or 2) upon the death of the Member. Typically, the Alternate Payee’s share is determined using the “Time Rule” formula, i.e. the Alternate Payee will receive 50% of the Member’s monthly retirement allowance multiplied by a fraction where the numerator is the Pension Trust Service Credit attributable to the Member’s employment during the marriage (from date of marriage through the date of separation), the denominator is the total of the Member’s Pension Trust Service Credit at the Effective Date of Retirement.

Under this method of division, the DRO may order the Member to elect a payment option that provides a survivor benefit annuity to the former spouse. The Optional Settlement that is to be elected by the Member must be specifically named in the DRO. There are 4 optional settlements that will allow for benefits to be paid to the former spouse upon Member’s death, aptly named Optional Settlement 1, Optional Settlement 2, Optional Settlement 3, and Optional Settlement 4. If the Member chooses and “Unmodified Retirement”, there are no survivor benefits and all payments to the Alternate Payee will cease upon the Member’s death. More information on the options available can be obtained by contacting the San Luis Obispo County Pension Trust.

Under method 1, if the Member ceases working for SLO County and elects to receive a refund of his/her contributions (which will not include contributions made by the employer), then the Alternate Payee would receive his/her share of the refunded contributions based on the formula specified in the DRO.

Method 2: Separate Account Established for the Alternate Payee

The second method of division for active members order the Plan to split the member’s service credit and contributions, and to establish a separate account for the Alternate Payee. This allows the Alternate Payee to decide on his/her own retirement option (either “Unmodified” or an “Optional Settlement” that names a beneficiary) and to have more control over when payments to the Alternate Payee will commence. Even if the Member is still working, the Alternate Payee can apply for and receive a refund of his/her share of the accumulated contributions available for refund. The Alternate Payee could can “retire” and begin receiving monthly annuity payments once the Member’s interest in the plan is vested and both the Member and Alternate Payee are 50 years old. The disadvantage of this method is that the Alternate Payee will not share in any increased value of the Member’s retirement allowance due to increases in compensation before retirement. The “compensation” factor of the annuity calculation is frozen as of the parties’ date of separation under Method 2. The Alternate Payee typically will be awarded 50% of the contributions made during the marriage – from the date of marriage through the date of separation.

Method 3: For Retired Members

Similar to Option 1 above, the Alternate Payee’s share will be calculated using the “Time Rule” and the Plan will make payments to the Alternate Payee until the retired Member’s death. Benefits will only be paid after the Member’s death if the Member chose an Optional Settlement at retirement and named the Alternate Payee as the beneficiary of the Optional Settlement. The option selected at retirement cannot be changed.

QUESTIONS ABOUT DIVIDING SAN LUIS OBISPO COUNTY PENSION TRUST BENEFITS?

If you have questions about dividing Pension Trust benefits or if you would like to get started on your DRO today, please call QDRO Helper at 619-786-QDRO (619-786-7376). Click here to request a new client package for a SLO County Pension Trust DRO. We proudly serve clients throughout California – no in-office appointments are needed.

DISCLAIMER: Any legal information on this blog has been prepared by QDRO Helper for informational purposes only and should not be construed as legal advice. The material posted on this website is not intended to create, and receipt of it does not constitute, an attorney-client relationship, and readers should not act upon it without seeking professional counsel. Note also that sending an e-mail to QDRO Helper does not create an attorney-client relationship, and none will be formed unless there is an express agreement between the firm and the individual.

Gillmore Rights and Your California QDRO

by Madeline Hill | Nov 9, 2012 | General QDRO Info

WHAT ARE GILLMORE RIGHTS?

Often an employee wants to continue working past her earliest retirement age. If the employee is divorced and her former spouse wants to start receiving benefit payments based on his community interest in the retirement plan, Gillmore rights allow him to start receiving his share of benefits before his former spouse actually retires. Specifically, these rights give an non-employee former spouse the ability to receive his/her community property share of the employee former spouse’s benefits at the earliest date on which the employee would be eligible to retire, regardless of whether the employee actually retires at that time. This option to commence benefits at the earliest retirement date is governed by federal law 29 USC §1056(d)(3)(E)(i); Internal Revenue Code §414(p)(4); and a California court case Marriage of Gillmore (1981) 29 C3d 418. These rights get their name from the Marriage of Gillmore case where the court determined that an employee who continues working past the date of retirement eligibility can be ordered to pay his/her former spouse his/her community share of benefits.

WHAT IS A GILLMORE ELECTION?

A “Gillmore Election” occurs when a non-employee spouse makes a motion in court to demand payment of benefits from the plan or the participant. (The process is started by filing form FL-300.) However, if a Qualified Domestic Relations Order is already in place granting the non-employee spouse a separate interest in the plan, the non-employee former spouse can simply contact the plan and commence receipt of benefits.

OTHER CONSIDERATIONS REGARDING GILLMORE RIGHTS

A Gillmore election is irrevocable. Therefore, if the non-employee former spouse commences benefits before the employee actually retires, the non-employee will not be entitled to share in any future benefit increases due to the employee’s continued service, increased age, or increased salary. The non-employee spouse will still be entitled to cost-of-living adjustments.

It is possible for parties to waive Gillmore rights explicitly as part of the divorce proceedings. However, parties should be aware that if they choose to divide retirement benefits by the Time Rule formula instead of a separation of account method, this can be construed as an implicit waiver of Gillmore rights, unless the QDRO states otherwise. Many plans, such as CalPERS, CalSTRS, and government plans require language in their Domestic Relations Orders stating that payments to the non-employee will not commence until the member actually retires and begins receiving payments. This is with regard to the plan and payments made directly by the plan only; a non-employee spouse could still seek court action against the former spouse to receive payments directly from the still-working employee.

QUESTIONS ABOUT YOUR CALIFORNIA QDRO OR GILLMORE RIGHTS?

If you have questions about Gillmore rights, dividing retirement benefits due to divorce, or if you would like to get started on your QDRO today, please call QDRO Helper at 619-786-QDRO (619-786-7376). Alternatively, you can email info@qdrohelper.com and request a new client package.

DISCLAIMER: Any legal information on this blog has been prepared by QDRO Helper for informational purposes only and should not be construed as legal advice. The material posted on this website is not intended to create, and receipt of it does not constitute, an attorney-client relationship, and readers should not act upon it without seeking professional counsel. Note also that sending an e-mail to QDRO Helper does not create an attorney-client relationship, and none will be formed unless there is an express agreement between the firm and the individual. We strongly advise against sending confidential or privileged information to QDRO Helper until you can establish such a relationship.

LACERS Benefits & Divorce: Los Angeles City Employees Retirement System

by Madeline Hill | Oct 31, 2012 | General QDRO Info, Public Employee Plans

If a member earns Los Angeles City Employees Retirement System (LACERS) benefits during marriage, those benefits are community property and are subject to division due to divorce, legal separation, or dissolution of a registered domestic partnership.

JOINDER REQUIREMENT

If the dissolution or separation matter is filed in a California court, then LACERS must be joined. Joinder is a legal process that names a third-party claimant to a divorce case. The joinder will put LACERS on notice of the pending dissolution action and forthcoming DRO, and will give the court jurisdiction over LACERS. If needed, QDRO Helper can file the necessary LACERS joinder documents for you for an additional fee.

NONMEMBER SPOUSE NOTICE OF INTEREST

In addition to the Joinder, the nonmember should also notify LACERS in writing that he/she is claiming his/her community property interest if the member’s benefits. The letter should include the parties’ date of marriage and date of separation, as well as the member’s name and social security number. This letter can be mailed to LACERS at 360 East Second Street, 2nd Floor, Los Angeles, CA 90012-4207. However, please note that the nonmember spouse will not be able to receive benefits until a domestic relations order is drafted, signed by the parties, filed at court, and sent to LACERS for implementation.

HOW BENEFITS ARE DIVIDED: IN-KIND DIVISION OR SEPARATE ACCOUNT

In-Kind Division:

For the “in-kind” division, the nonmember spouse is typically awarded one half of the community interest in the LACERS benefits. The community property interest is determined by the “time rule formula” – i.e. a fractional interest where the member’s service from the date of marriage through the date of separation (or “marital service”) is divided by the member’s total service. The Order may also specify that any service time purchased during the marriage be considered marital service. Although dividing the community interest 50/50 is the most common method of division, the nonmember could receive any percentage of the benefits awarded in the parties’ separation agreement or divorce judgment.

The nonmember may take his/her distribution “in-kind” which means that the nonmember will be paid a portion of the member’s pension for the member’s lifetime (and, if applicable, for the lifetime of the member’s surviving spouse). If the nonmember outlives the member (and the member’s surviving spouse) the payments to nonmember will cease. If the nonmember dies before the member (and the member’s surviving spouse), depending on the domestic relations order, the share would pass either to the nonmember’s beneficiary or heirs, or could revert to the member.

Alternatively, after the court order is filed, the nonmember spouse may elect to convert his/her “in-kind” interest to a life annuity based on the nonmember’s lifetime. This election will alleviate the risk of losing all benefits if the member (and/or the member’s then-current spouse) predeceases the nonmember former spouse. Upon the nonmember’s death, all benefit payments from LACERS stop.

Separate Accounts

If the DRO provides for the establishment of separate accounts, the nonmember has two options for distribution: 1) the nonmember can receive a refund of contributions and will relinquish any right to monthly benefits in the future or 2) the nonmember can receive a separate account allowance, payable for his/her lifetime. Note, that if the nonmember elects option 2, the allowance will be calculated based upon a formula using the member’s compensation at the parties’ date of separation, not the time that the allowance becomes payable. Another important restriction on the Separate Account method is that if the member never becomes eligible for a service retirement (due to death or disability retirement), then the nonmember cannot receive a separate account allowance (i.e. monthly payments), instead the only form of payment will be a refund of contributions.

It should be noted that a “refund of contributions” is a refund only of the contributions that the member paid in from the member’s salary, plus the interest on those contributions. This may not reflect the true value of the member’s benefits since a refund of contributions does not include any compensation paid for by the City.

It should also be noted that if the separate account method is used and if the nonmember spouse takes a refund of contributions, then the member can repay LACERS to restore his/her service credit under the Plan.

How Do I Decide Which Method to Choose?

There are pros and cons to both methods of division, and the best option for you will depend on your unique circumstances. The separate account method uses the member’s compensation at the date of separation while the in-kind division is based on the member’s compensation at the time of retirement. Since the member’s compensation at retirement is likely to be more than at the time of separation, the amount of the monthly benefit the nonmember receives with the separate account order is usually less than what he/she would receive with a typical in-kind division. However, the nonmember must wait for the member to retire before the nonmember can receive benefits under the in-kind division. The separate account allowance is paid for the nonmember’s lifetime, and will not be affected by the member’s death, while the in-kind division may or may not be payable, in this manner, depending upon whether the nonmember elects to take a life annuity at retirement.

One distinct advantage of the separate account method is that if the member is eligible to retire but is still working, the nonmember can start to get benefits before the member retires, assuming that all service retirement eligibility requirements have been met. This can be advantageous when the nonmember is significantly older than the member. If the nonmember can claim the separate account allowance now, the final compensation payable to the nonmember spouse over his/her lifetime may be similar what an in-kind order would provide. However, a distinct drawback to the separate account is that if the member never becomes eligible for a service retirement, due to death or disability, the nonmember can only receive a refund of contributions and interest paid in by the member, which would result in a loss of any employer contributions to the plan.

If you are unsure what option to choose, you should know that once a separate account is established by the Plan pursuant to the court order, the nonmember no longer has any right to an in-kind division. However, if an in-kind division is ordered by the court, and the court retains jurisdiction, then the order can be modified to establish a separate account in lieu of an in-kind division as long as the modification occurs prior to the member’s retirement.

The information provided here is only a basic summary. You should call LACERS at (213) 485-4917 if you have questions about your options.

NEED HELP WITH A LACERS COURT ORDER?

If you would like to get started on your LACERS DRO today, please call QDRO Helper at 619-786-QDRO (619-786-7376). Alternatively, you can click here to request a new client package for a LACERS court order. We proudly serve clients and attorneys throughout California – no in-office appointments are needed.

DISCLAIMER: Any legal information on this blog has been prepared by QDRO Helper for informational purposes only and should not be construed as legal advice. The material posted on this website is not intended to create, and receipt of it does not constitute, an attorney-client relationship, and readers should not act upon it without seeking professional counsel. Note also that sending an e-mail to QDRO Helper does not create an attorney-client relationship, and none will be formed unless there is an express agreement between the firm and the individual

Dividing IRAs in Divorce: Do You Need a QDRO?

by Madeline Hill | Oct 25, 2012 | General QDRO Info, IRA

What is an IRA?

IRAs are Individual Retirement Accounts which are governed by Internal Revenue Code §408. Usually the account owner is the person in control of the IRA, and the account owner is considered the “plan administrator.” The most common type of IRA is the traditional IRA; however, there are also simplified employee pension (SEP) IRAs, savings incentive match plan for employees (SIMPLE) IRAs, education IRAs, and Roth IRAs. Contributions made to an IRA during marriage (from the date of marriage through the date of separation) are considered community property in California and are subject to division due to dissolution of marriage.

Do You Need a QDRO to Divide an IRA?

IRAs are not “qualified retirement plans”. As such, a QDRO is not applicable to an IRA. Instead an IRA may be divided by a “divorce or separation instrument” pursuant to IRC §408(d)(6). The following are considered “divorce or separation instruments”:

A decree of divorce or separate maintenance or a written instrument incident to such decree
A written separation agreement
A decree requiring a spouse to make payments for the support or maintenance of the other spouse

In order to utilize a “divorce or separation instrument” to divide and IRA, you should be sure that your judgment or settlement agreement includes language that is sufficient to divide the IRA, provides a clear method of division, provides a valuation date as of which the IRA is to be divided, and address gains and losses on the non-owner spouse’s share.

In addition to a judgment or filed settlement agreement, some financial institutions will require a “Letter of Instruction,” signed by the IRA owner, directing them to divide the account. Occasionally, a financial institution will require a “QDRO” before dividing the account on behalf of the non-owner spouse. Although IRAs are not governed by ERISA, and are exempt from ERISA’s QDRO provisions, it is usually best to simply provide the financial institution with whatever documentation they require in order to divide the account, whether it is a judgment, settlement agreement, letter of instruction or a separate court order similar to a QDRO.

To divide an IRA you do not need obtain a joinder, as you may need to do with other types of retirement benefits, because the person who legally owns and controls the account is the spouse who is a party to the divorce action, not a third party plan administrator.

Tax Issues with IRAs and Divorce

To be a tax free transfer, the IRA transfer to the other spouse must made be pursuant to a court order. Further, money should be transferred directly from one IRA to another IRA or plan via either i) direct rollover distribution or ii) trustee-to-trustee transfer. Failure to utilize these methods of transfer can result in a mandatory 20% IRS tax withholding. If money is first distributed to an individual and is then rolled over within 60 days of distribution to an IRA or other plan, tax-deferred treatment is possible, but will only apply to 80% of the distribution unless the individual can contribute funds to make up for the 20% that was withheld. Funds received directly by an individual who is not yet 59 ½ will be subject to a 10% early withdrawal penalty. Unlike distributions made to a former spouse from a qualified retirement plan under a Qualified Domestic Relations Order, there is no “divorce” exception to the 10% additional tax on early distributions from IRAs because IRAs are not “qualified retirement plans.”

Need Help Dividing an IRA Due to Divorce?

Call QDRO Helper today at 619-786-7376 if you need help dividing and IRA due to divorce. We can prepare a QDRO if one is required. We also can help draft language for your divorce decree or settlement agreement that will allow the IRA to be divided. You can also email info@qdrohelper.com for more information. We are happy to assist clients throughout California – no in-office appointments needed.

DISCLAIMER: ADVERTISEMENT. Any legal information on this blog has been prepared by QDRO Helper for informational purposes only and is not legal advice and does not constitute a guarantee, warranty, or prediction regarding the outcome of your legal matter. The information provided is intended to comply with Rule 1-400 of the California Rules of Professional Conduct. Any links in this website are included only to help you locate other Internet resources that may be of interest to you; QDRO Helper is not associated with any such links. The transmission and receipt of information contained on this website via the Internet or e-mail or in any other manner does not constitute or create an attorney-client relationship, and you should not act on the information contained herein without obtaining legal counsel. QDRO Helper has a strict policy of entering into attorney-client relationships with its clients only though the execution of a written fee agreement acknowledged by QDRO Helper. As such, you should not send QDRO Helper any confidential information in response to this web page until such a relationship is established and expressly acknowledged by QDRO Helper.

LACERA & Divorce: Dividing Los Angeles County Employees Retirement Association Benefits

by Madeline Hill | Oct 15, 2012 | Defined Benefit Plans, General QDRO Info, LACERA

Permanent employees of Los Angeles County or outside Districts who work three-quarter time or more are members of the Los Angeles County Employees Retirement Association (LACERA). Any LACERA pension benefits that are accumulated during marriage are subject to division due to dissolution of marriage or termination of a registered domestic partnership. Orders dividing retirement benefits are often called Qualified Domestic Relations Orders, or QDROs; however, LACERA is exempt from the provisions of the Employee Retirement Income Security Act (ERISA), and orders dividing LACERA benefits are called Domestic Relations Order or DROs.

REQUESTING INFORMATION ABOUT LACERA BENEFITS

LACERA is a defined benefit plan under which a member accumulates service credit. Each LACERA member receives an Annual Benefit Statement which details the member’s accumulated service credit, contributions, and credited interest. Members can also request information about their accounts by sending a written request to LACERA. A person other than the Member can request the Member’s account information by either 1) providing written authorization, signed and dated by the Member within the 30 days prior to the information request or which is specifically valid for a longer time period; or 2) submitting a subpoena and Notice to Consumer, along with a $15 check for witness fees to the LACERA.

JOINDER REQUIRED FOR LACERA

LACERA must be joined before a DRO can be implemented. Joinder is a legal process that names a third-party claimant to a divorce case; LACERA is a third-party claimant to any dissolution case which involves LACERA benefits. The joinder will put LACERA on notice of the pending dissolution action and forthcoming DRO, and will give the court jurisdiction over LACERA. A joinder will also place a hold on a active member’s account which will remain in place until the member retires. The hold will prevent payment of a member’s benefit or a refund of accumulated contributions and interest until a DRO is received. If needed, QDRO Helper can file the necessary joinder documents for you for an additional fee .

LACERA RETIREMENT OPTIONS / OPTIONAL RETIREMENT ALLOWANCES

Various alternatives to the Unmodified Retirement Allowance are available under the County Employees Retirement Law of 1937 (CERL). The different options allow for variations in determining how retirement and survivor benefits are paid, and who can be designated as a beneficiary. Options 1-4 are summarized below:

• Option 1 (Government Code § 31761): If the member dies prior to receiving the contributions he or she paid into the retirement fund, Option 1 provides a single lump-sum payment (remaining balance of member’s accumulated contributions) to any named beneficiary. It does not provide a monthly survivor allowance. (Not available to Plan E members.)

• Option 2 (Government Code § 31762): Provides one named beneficiary with 100 percent of the member’s benefit, calculated on the date of death.

• Option 3 (Government Code § 31763): Provides one named beneficiary with 50 percent of the member’s benefit, calculated on the date of death.

• Option 4 (Government Code § 31764): Provides a customized lifetime benefit to one or more named beneficiaries via either a set monthly income or a fixed percentage of the member’s monthly allowance. The cost of customizing a benefit under Option 4 may be shared between the retired member and the non-member or the court may require one party to bear the cost.

Many divorcing members opt for Option 4 because it allows a member to name multiple beneficiaries amongst whom survivor benefits can be distributed – this can allow for survivor benefits to be paid to both a current spouse and the member’s former spouse.

TIME RULE FORMULA FOR DIVIDING LACERA BENEFITS

The most common method of dividing LACERA benefits is known as the Time Rule Formula. This formula will provide that the non-member spouse’s share of the LACERA benefits is 50% times a fraction where the numerator is the number of months of LACERA service from the date of marriage to the date of separation, and the denominator is the total months of LACERA service accrued at the member’s retirement.

The Time Rule Formula will also apply if a member terminates employment and elects to receive a refund of accumulated contributions; providing the non-member spouse with a community property share of such refund of contributions.

QUESTIONS ABOUT DIVIDING LACERA BENEFITS?

If you have questions about dividing LACERA benefits or if you would like to get started on your DRO today, please call QDRO Helper at 619-786-QDRO (619-786-7376) or click here to request a new client package for a LACERA DRO. We are happy to assist clients throughout California – no in office appointments needed.

DISCLAIMER: Any legal information on this blog has been prepared by QDRO Helper for informational purposes only and should not be construed as legal advice. The material posted on this website is not intended to create, and receipt of it does not constitute, an attorney-client relationship, and readers should not act upon it without seeking professional counsel. Note also that sending an e-mail to QDRO Helper does not create an attorney-client relationship, and none will be formed unless there is an express agreement between the firm and the individual.