Cincinnati Family Law & Divorce Blog: How Will My Retirement Be Divided?

In a divorce or dissolution, the parties will divide their marital assets. Often, the largest and most valuable assets accumulated during the marriage are their retirement accounts. In dividing these assets, there are a number of important considerations to consider.   First and foremost, retirement benefits are treated differently than other assets because they have different tax consequences. In most cases, the retirement benefits are pre-tax, meaning that once the party receives the benefit or draws from the balance of the account, he or she will pay income tax on that benefit. For this reason, these assets are typically not offset with the value of other assets such as bank accounts or the equity in a residence, or, if they are, tax adjustments will be made. In most cases, the retirement accounts are divided between the parties with separate court orders, such as a Qualified Domestic Relations Order (QDRO) or a Division...