Finance

Have Finance Questions? Ask a Financial Expert Online.

Ask an Expert,
Get an Answer ASAP!

Finance

I am in the middle of a divorce. I have a 401K through my

Customer Question
I am in the middle...
I am in the middle of a divorce.
I have a 401K through my employer..
it had 150K in 2000 which is 2 years before I go married in 2002.
Now the account has 115K in it.
I have been putting money into at an average of $400/month..
But the account has been loosing money for a long while...
My question is how to divide this account?
Is my spouse entitled to any of it?
Submitted: 2 years ago.Category: Finance
Show More
Show Less
Ask Your Own Finance Question
Answered in 9 minutes by:
11/13/2015
Financial Professional: Lane, JD, CFP, MBA, CRPS replied 2 years ago
Lane
Lane, JD, CFP, MBA, CRPS
Category: Finance
Satisfied Customers: 12,859
Experience: Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial & Tax advice since 1986
Verified

Hi,

...

That really depends on how the process goes. The judge certainly has the ability to divide it as part of the property settlement

...

I he/she does ... be sure that it's done through what's called a QDRO (Qualified Domestic Relations Order)

...

This is where an IRA is set up for your ex, and it's transferred into that just like a rollover. That way you have no tax when it's awarded (IF it ,or any OF it , is). She will be taxed as she pulls from her resulting IRA

...

NO states have automatic rules that say she's entitled, If you'd like to give me your stat I can see how things are handled I(for example in SOME states, every opportunity is given for you to work itout for yourselfves before the court ever become really involved.

Ask Your Own Finance Question
Customer reply replied 2 years ago
I live in NJ.
Again, if I had 150K before the marriage and now it is 115K..
So, there was a loss through out the marriage...
Does she get a portion of the 115K or nothing because there has been a loss
Customer reply replied 2 years ago
I have a listing of all the contributions and realized losses since 2000. If you'd like I can upload it to you.
Financial Professional: Lane, JD, CFP, MBA, CRPS replied 2 years ago

No, the facts you state here ... it's only worth now, less than what it was before the marriage, is a big piece of the pie Ia big factor in what a judge will say) but it's not that simple.

...

New Jersey is an Equitable distribution state, which means that the marital property will be divided between spouses in a way that is equitable, "fair."

...

The court decides what’s fair based on a set of factors designed to show ... (1) how the spouses contributed to the marriage and (2) what each of you will need to move forward after divorce. The division does not have to be equal.

...

So yes, you win on the (what you brought into the marriage (or existed before the marriage) BUT lots of other factors can swing it back the other way, say if it looks like she needs' MUCH more than you to move forward equally, and 401(k) is one of the only assets you have to contribute TO that.

...

You have a chance that, because of the value before marriage and the value today (and the fact that only you contributed to the plan that it will not even be considered as iin the "marital property" pot (which is what gets divided). Separate property

...

The court will presume that any new property gained during the marriage is marital property, regardless of what title says. Even gifts given between the spouses – except the engagement ring – are marital property.

...

Separate property is property owned before marriage or after one of you files for divorce.

...

So again, you have a LOT on your side that would say that the 401(k) is not marital property but separate property ... but a good divorce lawyer can sway the judge that it was because of whatever SHE brought to the table DURING the marriage that you were able to contribute what you did during that time, and that there would be even less there had you not contributed what you did because, say, she worked and helped cover the bills OR didn't work and stayed at home with children so you COULD word and save for the two of you.

...

To read more on how an increase in the value of separate property during marriage can transmute into marital property, see the case Scavone v. Scavone, 230 N.J. Super. 482, 486-93, (1988).

...

I wish it were simpler than this but the court in NJ has to look at a LONG list of factors, and the 401(k) is not necessarily completely off the table. The safe way to put it is, that's the starting point, but it stays in tact much better if your spouse has an asset worth the same value

...

Here's an excellent resource on this issue: https://www.weinsteinlawoffice.com/retirement-assets-and-new-jersey-divorce-101.html

Ask Your Own Finance Question
Financial Professional: Lane, JD, CFP, MBA, CRPS replied 2 years ago

According THIS NJ Attorney:

...

Pensions, 401Ks and any other qualified retirement assets are subject to equitable distribution in a New Jersey divorce. Each spouse has a right to any retirement accounts accumulated from the date of marriage (or after when applicable) to the date of the filing if the Complaint for Divorce in the Family Part of the Superior Court of New Jersey. In my practice as a family law attorney, the only time one spouse may retain “their” retirement asset is when we give the other spouse an asset that is equal in value during negotiations. This can be a complex scenario as an asset that is available immediately (i.e., a bank account) is different than a retirement account, which cannot be liquidated absent penalties and taxes. Sometimes an individual can take a loan from their pension, but then that person has a new monthly bill to pay.

Ask Your Own Finance Question
Financial Professional: Lane, JD, CFP, MBA, CRPS replied 2 years ago

I hope you'll rate me positively, using the stars on your screen … (that's the only way we get credit for the work here) … based on thoroughness and accuracy, rather than any good news/bad news content ... Hopefully, having all the facts will help you "see around some corners."

...

Let me know if you still have questions...

...

Lane

..

Ask Your Own Finance Question
Ask Lane Your Own Question
Lane
Lane
Lane, JD, CFP, MBA, CRPS
Category: Finance
Satisfied Customers: 12,859
12,859 Satisfied Customers
Experience: Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial & Tax advice since 1986

Lane is online now

A new question is answered every 9 seconds

How JustAnswer works:

  • Ask an ExpertExperts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional AnswerVia email, text message, or notification as you wait on our site. Ask follow up questions if you need to.
  • 100% Satisfaction GuaranteeRate the answer you receive.

JustAnswer in the News:

Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... Justanswer.com.
JustAnswer.com...has seen a spike since October in legal questions from readers about layoffs, unemployment and severance.
Web sites like justanswer.com/legal
...leave nothing to chance.
Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
I will tell you that...the things you have to go through to be an Expert are quite rigorous.

What Customers are Saying:

I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response...

T.G.WMatteson, IL

I WON!!! I just wanted you to know that your original answer gave me the courage and confidence to go into yesterday's audit ready to fight.

BonnieChesnee, SC

Great service. Answered my complex tax question in detail and provided a lot of additional useful information for my specific situation.

JohnMinneapolis, MN

Excellent information, very quick reply. The experts really take the time to address your questions, it is well worth the fee, for the peace of mind they can provide you with.

OrvilleHesperia, California

Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help.

Mary C.Freshfield, Liverpool, UK

This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!!

AlexLos Angeles, CA

Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult.

GPHesperia, CA

< Previous | Next >

Meet the Experts:

Rakhi Vasavada

Rakhi Vasavada

Financial and Legal Consultant

2,608 satisfied customers

Graduated in law with Emphasis on Finance and have have been working in financial sector for over 12 Years

Megan C

Megan C

Certified Public Accountant (CPA)

2,218 satisfied customers

Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level

Manal Elkhoshkhany

Manal Elkhoshkhany

Tutor

1,919 satisfied customers

More than 5000 online tutoring sessions.

JKCPA

JKCPA

CPA

844 satisfied customers

Bachelors degree and CPA with Accounting experience.

Eric

Eric

Financial Manager

559 satisfied customers

Loan servicing, counseling and real estate expert. Foreclosure Expert and Financial Planner.

R. Klein, EA

R. Klein, EA

Accountant

480 satisfied customers

TurboTax Expert. QuickBooks Certified Pro Advisor

Dimitry K., Esq.

Dimitry K., Esq.

Attorney

332 satisfied customers

NASD Licensed Rep, 1997-2001, Business Attorney

< Previous | Next >

Related Finance Questions
I am considering, possibly, moving my 401k to a IRA. I am
I am considering, possibly, moving my 401k to a IRA. I am just in the starting phase of this. I still need to speak with my accountant.The retirement company that handles my account has sent, at my re… read more
PDtax
PDtax
Owner
Master\u0027s Degree
1 satisfied customers
I inherited my father's IRAs. I have accounts with Fidelity
I inherited my father's IRAs. I have accounts with Fidelity and Schwab. One of my Schwab accounts is titled Inherited; the other is listed as a Roth. The Fidelity account is listed as an IRA. My quest… read more
LEV
LEV
Retired
Bachelor's Degree
14,896 satisfied customers
I have a question on SEP IRAs? i have income from both a
i have a question on SEP IRAs? i have income from both a single member LLC and straight up schedule C self employment income. … read more
abci168
abci168
Principal
27 satisfied customers
Please help, I have a seld-directed IRA and I have questions
Please help, I have a seld-directed IRA and I have questions regarding rollovers from my traditional IRA … read more
Chad CFP ®
Chad CFP ®
Certified Financial Planner(R), Pro
Master\u0027s Degree
727 satisfied customers
I had a IRA disallowed for paying property taxes directly. A
I had a IRA disallowed for paying property taxes directly. A rental home was sole asset. I sold the property 11/16. IRA started 3/6/12 as a rollover for $77,468. Property sold for $23,970 after taxes … read more
LEV
LEV
Retired
Bachelor's Degree
14,896 satisfied customers
I have a roth ira account with a bank that i also invest
I have a roth ira account with a bank that i also invest money and buying stocks. I want to know if i can attach a credit card to that account so i can buy bigger quantity of stocks straight from cred… read more
LEV
LEV
Retired
Bachelor's Degree
14,896 satisfied customers
I am interest in having my client conversion of Trad IRA to
I am interest in having my client conversion of Trad IRA to Roth IRA. Does the transfer have to be in cash or can we transfer securities and current market value?This is how I do the client Trad IRA R… read more
TaxRobin
TaxRobin
Vocational, Technical or Trade School
1 satisfied customers
Quick Question on IRA withdrawals and deposits. Here is the
Hi. Quick Question on IRA withdrawals and deposits. Here is the scenerio: Withdrawals were made $3k/withdrawal for bills, etc., on the following dates: Nov 11, 2016 Nov 20, 2016 December 3, 2016Total … read more
TaxRobin
TaxRobin
Vocational, Technical or Trade School
1 satisfied customers
I have a SEP IRA with a good amount of money in it. My
Hi, I have a SEP IRA with a good amount of money in it. My spouse is my beneficiary for this account. If I die, are there tax consequences for my spouse? How would this work? Thank you… read more
Barbara
Barbara
Enrolled Agent, Paralegal
3,466 satisfied customers
I have a question regarding IRA funds. I am refinancing a
I have a question regarding IRA funds. I am refinancing a rental and would like to get into a 15 year fixed loan. For that I need to put money in. Can I take the money out of my IRA? Will I be taxed this year? … read more
Lane
Lane
JD, CFP, MBA, CRPS
12,859 satisfied customers
Ministers Retirement Plan. How is a Roth IRA setup for the
Ministers Retirement Plan. How is a Roth IRA setup for the pastor? Want tax free future income. What would be the best vendor to setup this account. Is there such an account under 403?… read more
TaxRobin
TaxRobin
Vocational, Technical or Trade School
1 satisfied customers
I need to withdraw from an ira and was wondering if I'm in
I need to withdraw from an ira and was wondering if I'm in the 25% tax bracket, should I have 25% federal and 25% state taxes withheld. the state tax part confuses me. … read more
TaxRobin
TaxRobin
Vocational, Technical or Trade School
1 satisfied customers
This question is about my IRA. It matured last month, and I
this question is about my IRA. It matured last month, and I would like to know if there would be a penalty and what it would be if I took the funds out of this CD account and put them into a Savings I… read more
LEV
LEV
Retired
Bachelor's Degree
14,896 satisfied customers
Is an individual retirement annuity considered an Ira?
Is an individual retirement annuity considered an Ira? Trying to help my mother move this to her IRA that she has at another institution. Never heard of the term before but it has the acronym of an Ir… read more
Mark Taylor
Mark Taylor
Certified Public Accountant
Masters
2,217 satisfied customers
I have a question regarding transfering an IRA as your own
I have a question regarding transfering an IRA as your own from a spouse. Complicated question regarding an annuity. Did a transfer form to move an ira of my deceased wife's to my ira at another finan… read more
TaxRobin
TaxRobin
Vocational, Technical or Trade School
1 satisfied customers
Can you explain what a "Qualified Ira" is? Or a qualified
Can you explain what a "Qualified Ira" is? Or a qualified Annuity? I think that qualified plans are bot taxable when withdrawn? Thank you Fred… read more
TaxRobin
TaxRobin
Vocational, Technical or Trade School
1 satisfied customers
My husband's ira was in an annuity with Pacific Life. He
My husband's ira was in an annuity with Pacific Life. He passed away in January and I put the IRA in my name, but I think I would like to take the money out but I don't think I will receive the full a… read more
Lane
Lane
JD, CFP, MBA, CRPS
12,859 satisfied customers
Currently have 205k in ira contribute 2000year Would an
Currently have 205k in ira contribute 2000year Would an annuity be of any benefit vs ira Employer do esnt offer retirement plan… read more
Barbara
Barbara
Enrolled Agent, Paralegal
3,466 satisfied customers
Disclaimer: Information in questions, answers, and other posts on this site ("Posts") comes from individual users, not JustAnswer; JustAnswer is not responsible for Posts. Posts are for general information, are not intended to substitute for informed professional advice (medical, legal, veterinary, financial, etc.), or to establish a professional-client relationship. The site and services are provided "as is" with no warranty or representations by JustAnswer regarding the qualifications of Experts. To see what credentials have been verified by a third-party service, please click on the "Verified" symbol in some Experts' profiles. JustAnswer is not intended or designed for EMERGENCY questions which should be directed immediately by telephone or in-person to qualified professionals.

Disclaimer: Information in questions, answers, and other posts on this site ("Posts") comes from individual users, not JustAnswer; JustAnswer is not responsible for Posts. Posts are for general information, are not intended to substitute for informed professional advice (medical, legal, veterinary, financial, etc.), or to establish a professional-client relationship. The site and services are provided "as is" with no warranty or representations by JustAnswer regarding the qualifications of Experts. To see what credentials have been verified by a third-party service, please click on the "Verified" symbol in some Experts' profiles. JustAnswer is not intended or designed for EMERGENCY questions which should be directed immediately by telephone or in-person to qualified professionals.

Show MoreShow Less

Ask Your Question

x