When a retiree divorces or otherwise dissolves a marriage from a spouse designated as the retiree's beneficiary, a retiree may cancel any optional plan elected at the time of retirement and return to the Straight Life Annuity.
Regardless of whether a retiree or a member obtains a divorce, in some divorces, a court may divide an ATRS member's retirement benefits between the parties to the divorce, since retirement benefits earned during the marriage are considered marital property. A Qualified Domestic Relations Order (QDRO) is an order entered by the courts in a divorce that directs ATRS to make direct payment of a portion of a member's retirement benefits to his or her former spouse.
Under the provisions of ATRS, no benefit or distribution of funds may occur until the member applies for retirement or makes an application for a refund.
The information in this section provides an overview of the required ATRS Model QDRO as well as any applicable forms.
The process used for the division of an ATRS member's retirement plan benefit is the Qualified Domestic Relation's Order (QDRO). Act 44 of 2013, Arkansas Code § 9-18-103(b) requires the ATRS Board of Trustees to establish rules for the implementation of a QDRO and to adopt a uniform legal form approved by the legislature. This form is referred to as the ATRS Model QDRO. The current ATRS Model QDRO should be utilized for a divorce with an effective date of January 1, 2009 or after. For a divorce date prior to January 1, 2009, please contact the ATRS Membership Attorney, at (501) 682-1517 or info@artrs.gov to request the applicable ATRS Model QDRO.
This information and the ATRS Model QDRO will not replace the advice of an attorney. You should consult your attorney to protect your interests in your ATRS benefits. Be certain that you understand completely the terms of any proposed court order, including any order based in whole or in part on the ATRS Model QDRO before it is signed by the judge. While ATRS may provide you with information about the ATRS Model QDRO and your ATRS plan benefits and procedures, it cannot provide you with legal advice regarding your divorce or any of its court orders.
ATRS DOES NOT REQUIRE the division of your retirement benefits and it is not the intent of the ATRS Model QDRO to encourage the division of ATRS benefits in a divorce or settlement agreement; only the court can order the division of marital property according to Arkansas law.
The intent of the ATRS Model QDRO is to assist attorneys and members in preparing a court required QDRO that can be accepted and administered by ATRS. Payment is not possible unless the court enters a QDRO that complies with Arkansas Code § 24-7-202 et. seq. and § 9-18-101 et. seq.
In many divorces and/or settlement agreements, the court will order a division of retirement benefits between the spouse (Member) and the ex-spouse (Alternate Payee). The court's order permits the Member's retirement system to pay the Alternate Payee the retirement benefits from the Member's account when the Member retires. Therefore, if you are required by a court order to divide your retirement benefits with your ex-spouse and you are an active or retired member in the process of obtaining a divorce, or you have recently received a divorce, ATRS can help you or your attorney with processing the QDRO.
ATRS can arrange for direct payment to you and to the Alternate Payee for your ATRS retirement benefit. Retirement benefits are annuity funds; therefore ATRS can withhold and send federal taxes to the IRS and state taxes to the proper state agency. In order to authorize ATRS to do this, you must provide ATRS with a copy of the QDRO and a copy of your divorce decree or settlement. The QDRO must be deemed “qualified” by the ATRS membership attorney. ATRS cannot pay benefits under a QDRO until it is signed by the judge, file-marked by the court clerk, and in the member's record. RETIREMENT BENEFITS FROM A QDRO DO NOT VEST UNTIL THE MEMBER HAS RETIRED! If a member dies prior to receiving retirement benefits, only the accumulated contributions can be disbursed in accordance with the QDRO.
If you are assigned a member's retirement plan benefits, you must complete the Alternate Payee Enrollment Form to receive benefits from your former spouse. Payment will not be made to a former spouse without this form.
For more information see the FAQs below or contact the ATRS Membership Attorney at (501) 682-1517 or info@artrs.gov.
What is a Qualified Domestic Relations Order (QDRO)?
A "qualified domestic relations order" (QDRO) is a domestic relations order that creates or recognizes the existence of an alternate payee's right to receive, or assigns to an alternate payee the right to receive, all or a portion of the benefits payable to a member of a retirement plan.
What is a Domestic Relations Order (DRO)?
A domestic relations order is a judgment, decree, or order (including the approval of a property settlement) that is made pursuant to state domestic relations law (including community property law) and that relates to the provision of child support, alimony payments, or marital property rights for the benefit of a spouse, former spouse, child, or other dependent of a member.
Who can be an Alternate Payee?
For purposes of the QDRO provisions, an alternate payee cannot be anyone other than a spouse, former spouse, child, or other dependent of a plan member.
What information should the proposed qualified domestic relations order contain to qualify as a QDRO for the ATRS plan?
QDROs must contain the following information:
- The name and last known mailing address of the member and the alternate payee,
- The name of the plan (The Arkansas Teacher Retirement System) to which the order applies,
- The dollar amount or percentage (or the method of determining the amount or percentage) of the benefit to be paid to the alternate payee and,
- The number of payments or time period to which the order applies.
The ATRS Board of Trustees has adopted a uniform legal form approved by the legislature. The form is referred to as the ATRS Model QDRO and is available, at no cost, to assist attorneys and members in preparing a court required QDRO that complies with Arkansas Code § 24-7-202 et. seq. and the Arkansas Domestic Relations Law on QDROs at § 9-28-101 et. seq.
PLEASE NOTE: The current ATRS Model QDRO should be utilized for a divorce with an effective date of January 1, 2009 or after. For a divorce date effective prior to January 1, 2009, please contact ATRS at (501) 682-1517 or info@artrs.gov to request the applicable ATRS Model QDRO.
Do I have to use the ATRS Model QDRO to divide my retirement benefits for ATRS?
No. ATRS does not require the use of the ATRS Model QDRO; however, the QDRO you submit will usually have to contain most of the provisions in the ATRS Model QDRO for it to be accepted by ATRS. Any QDRO accepted by ATRS must comply with Arkansas law and ATRS retirement plan requirements. ATRS provides the ATRS Model QDRO form, at no cost, for you or your attorney's use.
How do I get information on my retirement plan for purposes of my divorce?
If you are a member of ATRS, you can request information on your account by contacting ATRS to request an Authorization to Release ATRS Retirement Account Records in order to have relevant information sent to you. If you have an attorney, you can submit an Authorization to Release ATRS Retirement Account Records Form naming your attorney as the person ATRS should send the information to. Please make certain to include your name, social security number, the time period of the documents you wish to receive, the address, and parties to whom the information should be mailed, and your signature.
If you are the spouse or former spouse of an ATRS member, you may obtain information on the member's account or benefits through your attorney by issuing ATRS a subpoena for the relevant documents or the member may authorize the release of the information by signing the Authorization to Release ATRS Retirement Account Records Form. Please submit any request for copies of records at least 4 weeks before the information is needed for trial or settlement.
You can contact ATRS at 501-682-1517 or info@artrs.gov to request an Authorization to Release ATRS Retirement Account Records form.
Where do I send the proposed QDRO for approval?
The proposed QDRO (ATRS Model QDRO or a QDRO form of your choice) should be sent to ATRS prior to having a judge sign the order. The fastest and easiest way is for you or one of the attorneys to E-MAIL a draft copy of the QDRO to ATRS. Please contact ATRS at (501) 682-1517 to request the applicable email address or, you can mail the proposed QDRO to:
Arkansas Teacher Retirement System
Attn: Legal Division
1400 West Third Street
Little Rock, AR 72201
The ATRS Attorney will review the proposed QDRO for content and compliance with federal and state laws and send an accepted or denied response to all parties.
When using the ATRS Model QDRO, how do I insert information?
When using the ATRS Model QDRO, you should insert the appropriate information as replacement for the phrases set off by parentheses or brackets. For example, (Date of Divorce) should be replaced with “April 2, 2013” or the appropriate date your divorce was granted. You can download and print the ATRS Model QDRO by clicking on this link or you can request it be sent to you.
When the ATRS Model QDRO gives me a choice, how do I choose?
Where there is a choice of alternatives, you may only choose one of the alternatives. Do not list all of the alternatives or ATRS will not be able to "qualify" or administer the order. When the model gives you instructions such as [Use either A or B], remove those phrases you do not use in the order so it's not confusing.
How do I know if my QDRO choices are consistent with my divorce decree or other property settlement in my divorce?
When completing the ATRS Model QDRO or QDRO form of your choice, either an attorney or one of the parties must use the final Divorce Decree or Settlement Agreement to determine the property rights of the parties. The ATRS Attorney cannot give legal advice on how to divide the ATRS retirement benefits. However, if you or your attorney submit the QDRO and it cannot be "qualified", the ATRS attorney may provide an explanation for the Order's failure and assist in drafting language that complies with the plan.
What if both parties are members of ATRS?
If both parties are members of ATRS, it will depend on whether one or both members are assigned benefits by the judge. If only one member is required to pay a portion of their benefits, only one QDRO is needed. If each party is assigned a portion of the others benefits, a QDRO is needed for each member. For example, if John Doe and Jane Doe are both ATRS members and obtain a divorce, and Jane Doe is ordered to pay John Doe benefits, only one QDRO is needed. If each party is assigned a portion of the other’s benefits, a separate QDRO is needed for each member.
What is the review process for approval of a QDRO?
Once the QDRO has been prepared, a copy of it should be sent to the ATRS Attorney. The attorney will review it to determine if it is qualified. If the submitted QDRO IS NOT "qualified", the ATRS Attorney will reject the proposed QDRO and notify you or the attorney of their decision. The proposed Order will be returned to you or the attorney with a written basis for the determination and an explanation on how it can be corrected. A reasonable amount of time will be given for the Order to be revised and returned to ATRS.
If ATRS does not receive a revised Order that it can accept, it will begin payments to the ATRS member and not to the alternate payee. The ATRS member will be responsible for any back payments until a qualified order is received.
If the submitted QDRO is "qualified", the ATRS attorney will give written notice to all parties that it has been accepted. The QDRO can then be taken to the court, signed by the judge and file marked by the county clerk. You or the attorney should send a FILE-MARKED copy of the QDRO along with a copy of the divorce decree and/or the settlement agreement to the ATRS attorney for scanning to your record.
What if the ATRS member has already been divorced?
The ATRS Model QDRO may be used if the ATRS Member has a prior divorce with a QDRO. However, ATRS can only administer both orders if the subsequent order does not attempt to require ATRS to pay benefits already assigned to another Alternate Payee (former spouse) from a prior divorce. For example, a QDRO could assign a portion of your accrued benefits from 2008-2010 to Alternate Payee "A" and, a subsequent QDRO could assign a portion of your benefits to Alternate Payee "B" from 2011 –2013.
What if I remarry the Alternate Payee or otherwise reach a subsequent resolution to a property settlement after a QDRO is accepted by ATRS?
The QDRO will remain in effect even if the parties remarry. The parties to a QDRO must return to the court that entered the QDRO and obtain an order superseding or nullifying the QDRO of record. A copy of the court order must be sent to ATRS. ATRS will not accept a release or notice to cancel the QDRO from a member or alternate payee. When ATRS receives the order from the court, the Alternate Payee's benefits will stop. ATRS suggests that you consult with an attorney before making this decision.
How do I determine the “value” of my retirement plan?
ATRS provides the parties with specific, objective information on a member's ATRS benefits. This includes information such as the amount of contributions and interest in the account at the time of divorce, amount of salary and service accrued during the marriage, whether the service is contributory or noncontributory, and a retirement estimate based on the current service credit and salary on file with the plan. ATRS will not provide estimates based on projected or assumed service and salary changes.
If you wish to calculate such estimates, please visit our Benefits Estimate page.
ATRS is frequently asked to calculate the “value” or “present value” of a member’s retirement benefits. The determination of “value” of a member’s account is a subjective process based on several assumptions. For this reason, ATRS may not provide a determination of the “present value” of your benefits nor is such a valuation needed for the Model QDRO. If you wish to obtain a valuation, you should consult with your attorney as to the need and cost of such assistance.
If I purchase service in ATRS, does this count as marital property that is assigned in the QDRO?
The purchase of service credit with ATRS is now subject to A.C.A § 24-7-612. Therefore, the answer to this question is best handled by your attorney.
May a QDRO require an immediate distribution of a participant’s account?
No, the ATRS retirement plan is a Qualified Benefit Plan that begins payment to the member and the alternate payee when the member retires.
What if I am already retired when I divorce and the court orders a QDRO that assigns a part or all of my ATRS benefits to a former spouse?
If the member is already retired when a QDRO is ordered by the judge, ATRS will begin payments to the alternate payee one month after the QDRO is received and recorded in the member's record. ATRS cannot process a QDRO until it is received by ATRS. Additionally, an Alternate Payee Enrollment Form must be in the member's record to begin payments to him or her. Any unmade payments due the alternate payee prior to ATRS receiving the QDRO are the responsibility of the parties.
How does ATRS report the annuity taxes from a QDRO to the IRS?
All tax payments to the IRS and the State are reported separately. In January of each year, the member and alternate payee will receive an IRS 1099-R Form based on their annuity benefits for the prior calendar year. The IRS 1099-R will contain the number and amount of payments and amount of non-taxable payments, if any.
If the alternate payee dies prior to receipt of benefits under a QDRO, do the benefits revert to the member?
Benefits under a QDRO do not vest until the member retires. If an alternate payee dies prior to the member retiring, the benefits will go to the member.
If the alternate payee dies after he or she begins receiving benefits under a QDRO, will those benefits revert back to the member?
No. If the alternate payee is receiving a monthly retirement check and he or she dies, there is no more retirement benefit for the alternate payee. Since the monthly retirement check is solely the property of the alternate payee, there is nothing to "revert back" to the retired member.
What if I do not include certain ATRS benefits in the QDRO?
ATRS will administer the QDRO as written and ordered by the court. A copy of the divorce decree and/or the settlement agreement must accompany the QDRO so ATRS can comply with the court's order.
What if the member is eligible for the lump sum death benefit?
Although the court can order in the divorce decree that certain beneficiaries names be in a Lump Sum Death Benefit, the ATRS Lump Sum Death Benefit is not part of a QDRO.
Who is responsible for notifying ATRS of the QDRO?
The Court will usually direct one of the parties or attorneys to prepare the QDRO. Once it is prepared, it should be sent to ATRS for review. If the QDRO is "qualified" and accepted by the ATRS Attorney, a certified copy of the QDRO should be sent to ATRS. If this is not done, ATRS will not know that retirement benefits are to be paid to an alternate payee at the member's retirement.
If I am the alternate payee, how do I set up my ATRS account in order to receive benefits under a QDRO?
First and foremost, you will need to complete and submit the Alternate Payee Enrollment Form. ATRS strongly encourages the Alternate Payee to submit this form as soon as possible following completion and ATRS acceptance of the QDRO.
Once the member begins the retirement process, the Alternate Payee will need to submit all necessary documents to begin the payment process:
Alternate Payee Required Documents:
- Copy of Social Security Card
- Alternate Payee Enrollment Form
- Taxpayer Identification Number (TIN) if applicable
- Direct Deposit
- Tax Election Form
ATRS will set up the alternate payee account once all the required documents have been received. It is the responsibility of the Alternate Payee to maintain up-to-date records with ATRS. If you wish to change banks or tax elections, you can complete and submit the applicable forms above. If you have a change in name or address, please use the following form and submit to ATRS as soon as possible.
Alternate Payee Change of Address/Name Form
Where do we send the final QDRO?
The final version of the Model QDRO must be sent to ATRS (see mailing and email address below). DO NOT submit the QDRO to your employer! The employer does not administer a QDRO and the employer will not notify ATRS that they have received a QDRO.
How can I get a copy of the ATRS Model QDRO Form?
You can click here, ATRS Model QDRO, to download the document. You can also request a copy be sent to you or your attorney through email or USPS by contacting the ATRS Attorney at the following contact information:
Arkansas Teacher Retirement System
Attn: Legal Division
1400 West Third Street
Little Rock, AR 72201