Who must approve a qualified domestic relations order (QDRO)?

Who must approve a qualified domestic relations order (QDRO)?

• A. The court and both parties involved
• B. The qualified plan administrator
• C. The divorce attorney for both parties
• D. The financial advisor overseeing the retirement plan

Answer: (B)

The correct answer is that the qualified plan administrator must approve a qualified domestic relations order (QDRO). A QDRO is a legal order that recognizes the right of an alternate payee, such as a spouse or former spouse, to receive a portion of retirement benefits from a qualified plan. In order for a QDRO to be valid and enforceable, it must not only be approved by the court as part of the divorce proceedings, but it also requires the approval of the plan administrator. The plan administrator reviews the order to ensure that it complies with the specific requirements set forth in the plan document and federal law. This approval is critical because it allows the distribution of retirement benefits in accordance with the terms of the QDRO. While the involvement of the court and both parties can be vital in the initial drafting and agreement of the QDRO, it is the plan administrator who ultimately validates the order's compliance with the plan's rules and ensures that the benefits are properly allocated. Thus, the critical step in the QDRO process hinges on the plan administrator’s approval.

The correct answer is that the qualified plan administrator must approve a qualified domestic relations order (QDRO). A QDRO is a legal order that recognizes the right of an alternate payee, such as a spouse or former spouse, to receive a portion of retirement benefits from a qualified plan.

In order for a QDRO to be valid and enforceable, it must not only be approved by the court as part of the divorce proceedings, but it also requires the approval of the plan administrator. The plan administrator reviews the order to ensure that it complies with the specific requirements set forth in the plan document and federal law. This approval is critical because it allows the distribution of retirement benefits in accordance with the terms of the QDRO.

While the involvement of the court and both parties can be vital in the initial drafting and agreement of the QDRO, it is the plan administrator who ultimately validates the order's compliance with the plan's rules and ensures that the benefits are properly allocated. Thus, the critical step in the QDRO process hinges on the plan administrator’s approval.