Georgia courts might consider retirement plans as marital property, which is subject to equitable distribution in a divorce. However, whether or not your plan is distributed in this manner depends on several factors, including when you acquired the pension and the financial needs of you and your spouse at the time of divorce.
When you divorce, only certain property is subject to division by a Georgia court. When couples marry, generally, property they acquire from that date forward is considered the joint property of both spouses. Such assets are considered marital property and are divisible in a divorce proceeding. However, each spouse's separate property is not up for grabs. Separate property is the property that either spouse individually acquired either before the marriage or during the marriage by inheritance or gift. Accordingly, pensions are considered marital property if they were acquired during the marriage. Even if a pension was acquired before the marriage, any earnings that accrue during the marriage are divisible in a divorce.
When it comes to dividing marital property, including your pension, Georgia follows the equitable distribution method. Under this scheme, the court distributes property between spouses in a manner that is fair and just, though not necessarily equal. The court determines how to divide property by evaluating several key factors, which include the needs of each spouse, the standard of living of the parties during the marriage, each spouse's age as well as health and earning capacity, any established custody arrangement, each spouse's contribution to the marriage and marital assets, and the income, assets and debts of each spouse.
If the court decides your spouse should receive a share of your pension, it will execute a court order, specifically designed for that purpose, known as a Qualified Domestic Relations Order, or QDRO. With a QDRO, the court informs the plan administrator of your spouse's right to receive payment from your pension and what percentage or amount of your pension she is entitled to receive. Once the plan administrator approves the QDRO, your spouse becomes authorized to receive payments. However, without a QDRO in place, your spouse cannot collect from your pension, even if the court granted her a portion of it in your divorce decree.
Although a QDRO might be in place, your spouse cannot receive payment until she is authorized to do so under the terms of the plan. That's because each retirement account has its own rules for when payouts can occur, even if pursuant to a QDRO. For example, some retirement accounts permit payment immediately, such as 401(k)s. In these cases, the recipient spouse usually rolls over the funds into a separate retirement account. Other retirement plans require nonparticipant spouses to wait until the participant spouse retires or reaches retirement age. It is not uncommon for courts to award spouses additional property in lieu of a share in a pension when payment would not occur for several years in the future. However, courts can distribute pensions in a variety of creative ways. For example, a court might order the participant spouse to pay alimony to the nonparticipant spouse once his pension matures.