Why a QILDRO and a QILDRO Calculation Order

Why A QILDRO And A QILDRO Calculation Order

You have had or are about to have entered a Qualified Illinois Domestic Relations Order (QILDRO). Why would you also need a QILDRO Calculation Court Order?

Most QILDRO’s provide a percentage to be granted to the Alternate Payee. That is because the Judgment for Dissolution of Marriage usually only provides a percentage, or perhaps also gives an approximate amount, but not a definitive number.

QILDRO’s are, or should be, entered a short time after the divorce is finalized.  At the entry of your Judgment, the participant spouse may not have retired. If that is the case, it is impossible to know how much the retirement will be. The final retirement amount is pat of the formula most commonly used to determine the marital portion of the pension. And so, you wait until the participant applies for retirement.

Once the participant applies for retirement, the Plan Administrator will issue a benefit statement showing the final retirement amounts. At this point, the percentages in the QILDRO can be replaced with numbers. These numbers are input into the QILDRO Calculation Order, which is entered by the Court and a certified copy is provided to the Plan.

Of course, if you had a number in the QILDRO, you would not need a QILDRO Calculation Court Order. You could have a number in the QILDRO if at the time of entry of the QILDRO, the final retirement amounts were known.

What about annual increases, often termed cost of living adjustments (COLA), will those be applied to a QILDRO containing a number instead of a percentage? A correctly completed QILDRO will provide for such increases to be proportionately applied to each party’s share, so the Alternate Payee’s amount would be credited with its share of those increases.

To learn more, contact a competent QILDRO attorney.

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