Are Pension Funds and Retirement Accounts Marital Property under Florida Law?
Many of the clients of our Fort Lauderdale and Miami divorce attorneys are shocked to learn that their soon to be ex-spouse may be entitled to a portion of their retirement or pension fund. In Florida, pension and retirement funds that accrue during the marriage must be treated as marital property and are generally shared equally. However, there are exceptions and modifications to this rule that may help you protect all or part of your retirement savings.
Florida law holds that all vested and non-vested benefits, rights, and funds that accrue during the marriage are marital assets subject to equitable distribution during a divorce. This law applies to any 401(k), pension, Individual Retirement Account (IRA), annuity, or Deferred Retirement Option Program right (DROP) that is acquired or accrues during the course of the marriage. If the court determines a pension or retirement fund is a marital asset, they will issue a Qualified Domestic Relations Order (QDRO) that instructs the plan administrator to divide the fund according to the divorce decree. The non-employee spouse is usually entitled to the same rights under the plan as the employee spouse, such as cost-of-living adjustments and early withdrawal options, and is eligible to receive his or her share of the ex-spouse's benefits when the ex-spouse is entitled to receive them.
If a party has not contributed to their retirement account since the day they were married, the account will not be considered a marital asset. Likewise, contributions made to a retirement account both before the marriage occurred and after it dissolved are the separate property of the employee who made the contributions and are not considered marital property. When determining what portion, if any, of a retirement account is not a marital asset, the courts will consider the length of any marital separation and whether marital “efforts” or earnings were use to acquire the benefits. If a party argues that all or part of his or her retirement account should not be considered marital property, they will have the burden of proving when the retirement benefits accrued.
On the other hand, if a spouse is retired and dependent on a retirement account for income, the funds may be considered income instead of assets. In this situation, the retirement account will be considered in alimony and child support decisions, but will not be divided as marital property.
The divorce attorneys in our Fort Lauderdale and Miami offices can evaluate the complexities of Florida law and help you reach the best possible outcome in the division of your retirement or pension funds during your divorce. Please feel free to contact us for a free initial consultation.
