QDRO
I have clients that are getting divorced. Funds will be transferred from the husband’s IRA to the wife’s IRA. I manage both IRAs. Does the IRS require a QDRO?
I have clients that are getting divorced. Funds will be transferred from the husband’s IRA to the wife’s IRA. I manage both IRAs. Does the IRS require a QDRO?
Permalink Submitted by Alan - IRA critic on Wed, 2020-01-22 14:20
No, a QDRO does not apply to IRA accounts. The wife needs to secure a court order for a “Transfer Incident to Divorce”. Her attorney will be familiar with the wording and detail to be included. The result is a non reportable direct transfer of the funds from husband’s IRA to hers or to a new IRA she has established to receive the funds. If husband has any basis in his IRA, it is split proportionately and a new 8606 is filed for each spouse.
Permalink Submitted by Bill Winters on Wed, 2020-01-22 14:58
I’m going to be receiving funds in a divorce from my spouse from a TSP. When and how do I open a IRA to receive those funds?
Permalink Submitted by Alan - IRA critic on Wed, 2020-01-22 16:21
See response made to your other post.