Asked 5/13/2010
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Can I take the Employer Match amount out of my 401K in my divorce settlement since I didn't actually pay that amount. Under Texas Divorce Law I am in a divorce and my husband wants half of my 401k because he didn't put any in his. Can I take the Employer Match amount since those are funds that I didn't put in. |
Answer 1/2 - Submitted 5/13/2010
You cannot decide what is up for grabs.. it is usually the ENTIRE amount that he will get a percentage of. Right now, you cannot touch anything in the account until the final QDRO is drawn and signed -- they will then remove his portion - or + any losses or gains. The norm is 50/50 but I have seen a spouse awarded less and a spouse awarded the entire thing.. depends on the situation and other assets involved.
Answer 2/2 - Submitted 8/19/2010
First, if you and your spouse agree on how to split the account (or whether to split it), that's fine. But the employer match is just another form of your earnings, which are community property, and are subject to a just and right division at trial. You should exclude the separate property interest, which is the amount in the account at time of marriage plus the amount this this has increased in value from appreciation (but not from dividends or interest). But even taking out the separate property interest is a manual calculation and the documents need to reflect the dollar amount or the percentage of the total balance that is to be given to the spouse.
FREE Texas Civilized Divorce Guidebook: www.Civilized-Divorce.com
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