Who can be an alternate payee?
(K) The term “alternate payee” means any spouse, former spouse, child, or other dependent of a participant who is recognized by a domestic relations order as having a right to receive all, or a portion of, the benefits payable under a plan with respect to such participant.
Can an alternate payee name a beneficiary?
ERISA provides that a person who is an alternate payee under a QDRO generally shall be considered a beneficiary under the plan for purposes of ERISA.
Who can be beneficiary of ERISA?
A spouse always receives half the assets of an ERISA-governed account unless he or she has completed a Spousal Waiver and another person or entity (such as an estate or trust) is listed as a beneficiary.
What does the term alternate payee mean?
Under these sections of the law, a QDRO can be used to assign all or a portion of a Plan Participant’s benefits to an “Alternate Payee”, most commonly, the Participant’s ex-spouse (though it may also be the Participant’s current spouse, child, or other dependent to satisfy family support or marital property obligations …
Who is an alternate payee in a retirement plan?
For purposes of this rule, an “alternate payee” is any spouse, former spouse, child, or other dependent of the participant who is recognized by the domestic relations order as having a right to receive plan benefits.
When do you have to have a retirement plan under ERISA?
Most of the provisions of ERISA are effective for plan years beginning on or after January 1, 1975. ERISA does not require any employer to establish a retirement plan. It only requires that those who establish plans must meet certain minimum standards. The law generally does not specify how much money a participant must be paid as a benefit.
Can a domestic relations order invalidate an alternate payee?
Since the order allows Janet to name anyone as successor to her share of plan benefits, it could require the plan to pay benefits to someone other than an alternate payee (e.g., a friend, neighbor, or creditor). Accordingly, the court found the domestic relations order invalid. 1. Contingent Alternate Payee
When is a domestic relations order qualified under ERISA?
ERISA § 206 (d) (3) (B) states that a domestic relations order is “qualified” if it “creates or recognizes the existence of an alternate payee’s rights to, or assigns to an alternate payee the right to, receive all or a portion of the benefits payable with respect to the participant under a plan . . .” (italics added).
For purposes of this rule, an “alternate payee” is any spouse, former spouse, child, or other dependent of the participant who is recognized by the domestic relations order as having a right to receive plan benefits.
Since the order allows Janet to name anyone as successor to her share of plan benefits, it could require the plan to pay benefits to someone other than an alternate payee (e.g., a friend, neighbor, or creditor). Accordingly, the court found the domestic relations order invalid. 1. Contingent Alternate Payee
ERISA § 206 (d) (3) (B) states that a domestic relations order is “qualified” if it “creates or recognizes the existence of an alternate payee’s rights to, or assigns to an alternate payee the right to, receive all or a portion of the benefits payable with respect to the participant under a plan . . .” (italics added).
Do you need to take action on ERISA account?
If you are the participant of the plan, you do not need to take any action. ERISA will review your account and divide the assets to both parties as the QDRO instructs. If you are the Alternate Payee, you will be provided with an online account where you may choose how the assets are distributed.