In a Florida divorce, property division is one of the most common reasons for disagreement during the process. There is often confusion about how to divide property in a way that is considered fair. Most states – including Florida – use the equitable distribution model. For example, if a person owned a business and did most of the work, they can expect to receive a greater share of it in the divorce. Still, there are areas of property division that can be complex and that includes retirement plans.
Understanding how retirement plans are divided in a divorce
Just like other properties acquired during a marriage, retirement plans are subject to equitable distribution. If there is a retirement account, a profit-sharing plan, insurance plans, annuities, deferred compensation or a pension, it will be assessed under equitable distribution. With that, people who believe their 401(k) is theirs and theirs alone and they will enjoy the proceeds should think about the possibility that it might be divided in a divorce. This is true for other retirement plans as well.
A notable part of the law centers on those who were in the federal uniformed services. The duration of the service and the duration of the marriage are relevant in this case. If the service member accumulated 10 years and the marriage lasted for a minimum of 10 years during the time the person served, there are rules for how retirement will be split. The court will need to identify the service member; certify that the Servicemember’s Relief Act was followed if the couple divorced while the person was active and did not have a legal representative; know the amount of pay; and implement an order that says the pay will come from this source no more than once a month.
Property division can be acrimonious and help is key
People might not be fully cognizant of property division under the law when they start their divorce. Equitable distribution states differ from community property states. Community property splits that which was accrued during the marriage in half. With equitable distribution, the court strives to come to an outcome that it deems fair. That could mean one spouse gets more than the other. Despite the belief that a person who has a retirement plan will get to keep it in full, that might not be the case. From the perspective of either party, it is imperative to have assistance with this complicated issue.