The Law

The Pension Code

The Illinois Pension Code controls how Illinois State, County and Municipal Pension Plans are administered. The Code is very long and complex. You can find it here in its entirety. The only way to divide a plan under the Code is by a Qualified Illinois Domestic Relations Order (QILDRO), which is addressed by Section 1-119 of the Code. A QILDRO “means an Illinois court order that creates or recognizes the existence of an alternate payee’s right to receive all or a portion of a member’s accrued benefits in a retirement system, is issued pursuant to this Section and Section 503(b)(2) of the Illinois Marriage and Dissolution of Marriage Act, and meets the requirements of this Section.”  40 ILCS 5/1-119(a)(6).  

Illinois Court

No Court, other than an Illinois Court, can enter a valid QILDRO. Since a QILDRO is the only way to divide a plan subject to the Illinois Pension Code, it follows that a court of another State cannot divide such a plan. Not a problem if you are divorced in Illinois and a resident of Illinois, but can be a great problem if the Divorce Decree is entered by another State’s court or neither of the parties resides in Illinois any longer. The CTPF summarized the issue nicely:

If your divorce occurred in another state, it may be possible to request an Illinois court to enter a QILDRO. Courts in other states do not have statutory authority or jurisdiction to issue QILDROs. However, an Illinois court may be requested to enter a QILDRO based on your out-of-state divorce. Please seek advice from your personal attorney if you were divorced in a state other than Illinois and you wish to obtain a QILDRO. 

Another State’s court can require a former spouse to pay his/her ex-spouse a certain amount each month (as s/he receives her/his monthly pension check), but that is certainly not a preferred  method. Therefore, act fast, while there is no doubt that Illinois has personal jurisdiction to enter the QILDRO. If you are in a situation where personal jurisdiction may already be an issue, contact QILDRO, INC. to determine the best course of action.