>According to Thompson Publishing Group, the Illinois court said that a QDRO issued under those circumstances is valid despite a state law barring seizure of a bankruptcy debtor’s retirement plan assets to satisfy a debt.
>While the Illinois law protects the debtor’s retirement plan benefits, retirement benefits are still considered marital property to the extent they were accumulated during the marriage, the court explained. That’s why a spouse isn’t considered a typical creditor under the law when a former spouse goes after a plan participant’s retirement accounts using a court order, the court said.
>The judges said that it was more important for society to have child support paid on time than to be concerned about the future receipt of pension benefits. However, the value of the QDRO-directed payment can’t be higher than the retirement account balance at the time of the divorce, the court said.
The case is In re Marriage of Thomas, 789 N.E.2d 821 (May 5, 2003).
« Pension Woes Pop Up Across the Pond