The road to retirement includes many different life events. If you are divorcing, review the information on this page to understand how divorce may impact your IPERS benefits.
A qualified domestic relations order (QDRO) is a special court order, separate from the divorce decree, that specifies how pension assets will be divided following a divorce. The QDRO, not the divorce decree, gives IPERS legal authority to make a payment to a former spouse.
If you and your former spouse agree to divide other marital property equitably, a QDRO may not be necessary.
You or your attorney must submit the QDRO to IPERS for review. For IPERS to execute the QDRO, it must:
- Be signed by a duly appointed judicial official.
- Be filed in accordance with applicable laws and procedures (Iowa Code section 97B.39, 495 Iowa Administrative Code 16.2 (97B) and the Internal Revenue Code).
IPERS’ sole responsibility is to determine if we can administer the Order; if so, it will be qualified by IPERS and added to the Member's account. We do not determine what should be included in the QDRO, other than the required paragraphs.
If you are divorcing after you retire, both you and your attorney should keep these points in mind.
- Your former spouse is referred to as an alternate payee by IPERS.
- IPERS can only administer a shared payment method for dividing benefits. Only one account exists and, as the IPERS member, it is your account. IPERS will track payments to your former spouse for tax reasons only.
- The payment option chosen at retirement cannot be changed.
- Until your divorce is final, you must have written consent from your spouse to change your beneficiary designations.
- Some benefit payment options that are chosen at retirement may prevent full implementation of a QDRO. Consider these options when drafting your domestic relations order.
- Ask your attorney to contact IPERS to review your QDRO for preapproval. This will help avoid prohibited terms and conditions.
Model QDRO and Instruction Packets
IPERS does not generate QDROs, but model QDROs and QDRO instruction packets are available to assist you. They include:
- Mandatory, permitted and prohibited provisions.
- Summary of the legal requirements.
- Practical pointers for drafting a QDRO.
Use the models and instruction packets to help expedite IPERS’ review and ensure the acceptance of your proposed or final order.
The model QDROs and instruction packets reference several important forms a member may need to complete.
Questions? IPERS is here to help.
Contact the legal department today.
FAQ Accordion Title
Frequently Asked Questions
IPERS is a defined benefits plan, and its members earn a retirement benefit based on a formula that uses three factors: the member’s age at retirement, the member’s service credit (time worked in IPERS-covered employment), and the average of the member’s highest-earning years. IPERS retirement benefits are paid as a monthly lifetime annuity.
No. IPERS is a defined benefit plan and we do not provide lump-sum past or present value calculations of a member’s account. IPERS will provide you with a copy of your most recent Annual Benefits Statement.
If a QDRO needs to be drafted at the conclusion of your divorce proceedings, make sure that the drafting attorney uses the most recent QDRO template and instruction packet from the IPERS website. If a QDRO is not necessary, a copy of the final divorce decree and stipulation should be sent to IPERS so that it can be noted on your account that you retain full right and title to your IPERS benefits.
Member: A QDRO is not always necessary. If you and your spouse or former spouse can agree to divide the marital property equitably, then IPERS benefits may not need to be divided and there may not be a need for a QDRO.
Alternate payee: Without a QDRO, the alternate payee receives nothing from the member’s account. Timely entry of the QDRO is critical to protect your rights to a shared payment when a distribution occurs from the member’s account. Even more important is entry prior to the death of the member. THE ONLY DOCUMENT that can assign a share of benefits to you is a QDRO. A divorce decree is not sufficient.
IPERS provides shared benefit payments to the member and the alternate payee according to the terms of the QDRO. Neither party will receive payments until the member qualifies for their benefit.
IPERS cannot draft QDROs for you; however, we provide several tools to assist you and your attorney in drafting the order. Make sure that the drafting attorney uses the most recent QDRO template and instruction packet from the IPERS website.
No. IPERS cannot give legal advice about your divorce settlement or your QDRO.
IPERS is happy to assist and will answer general questions as your attorney drafts a QDRO. For account specific questions, IPERS will require an appropriate Release of Information Authorization form be signed and submitted by the member.
There are four “distribution events” (payment types) that a QDRO can cover when awarding a shared payment to an alternate payee. A QDRO must explain how each potential distribution event will be shared, or the alternate payee will not be eligible to receive any portion of the related payment(s).
A QDRO can direct IPERS to share the following two distribution events with the alternate payee after the member applies for one of them:
- Monthly retirement benefit (both parties receive a share of the monthly payments).
- Lump-sum refund (both parties receive a share of the one-time lump-sum payment).
A QDRO can also direct IPERS to share the following two distribution events with the alternate payee after the member’s death, if a benefit becomes payable to the member’s beneficiary(ies):
- Lump-sum preretirement death benefit.
- Postretirement death benefit.
A QDRO can give an alternate payee some or all of the benefits payable from a member’s IPERS account. A QDRO cannot require IPERS to provide increased benefits over what would otherwise be payable based on the member’s record (as determined on the basis of actuarial value). A QDRO also cannot require IPERS to provide a type or form of benefit, or any option not otherwise provided under IPERS.
IPERS does not split accounts. Alternate payees do not have their own IPERS account nor any funds segregated as their own. The alternate payee cannot receive payments until the IPERS member, or the member’s beneficiaries, receives a payment. The alternate payee receives a portion of the member’s benefit payment, according to the percentage, dollar amount, or period of payment the alternate payee was awarded in the QDRO.
Pre-retirement QDROs: No. If the IPERS benefit is divided, the money in the member’s account is not transferred into a separate account. Although you are awarded a shared payment in a divorce decree, your right to a payment from IPERS occurs when there is a payment from the account.
Shared payments from IPERS are made to you only when the member terminates employment with an IPERS-covered employer and initiates a payment by applying for a monthly pension benefit or a lump-sum refund. Or, if the member dies before applying for either of the above, and a share has been awarded in the QDRO, you may receive payment as part of the lump-sum pre-retirement death benefit.
Post-retirement QDROs: Yes. If the member is already receiving monthly retirement benefits, once there is a qualified QDRO and the required 30-day appeal period passes following qualification of the QDRO, IPERS may begin making shared payments to you, prospectively from that date.
Please note the following important points:
- IPERS does not split accounts. Alternate payees do not have their own accounts at IPERS.
- There is no money segregated for you at IPERS. The award in the QDRO is an award of a portion of the member’s (or the members’ beneficiary’s) benefit that is paid upon the member’s retirement.
- You have no individual rights of election and cannot name beneficiaries.
- Neither you nor the member has a right to take an early distribution or withdrawal.
The member and the alternate payee must be paid using the same method. If the member elects a monthly payment, then the alternate payee must receive a monthly payment.
No. Once the member receives the first monthly benefit payment, the option cannot be changed.
If you are still legally married, you cannot change your beneficiary without the written consent of your current spouse. You must obtain your current spouse’s signature on the Beneficiary Designation form. If your spouse agrees to the change and signs the form, you may change your beneficiary. If not, you must wait until the divorce is final.
Once the QDRO is qualified, it is the responsibility of the alternate payee to keep IPERS apprised of their current contact information. Failure to do so may result in delayed benefit payments. IPERS will not search for alternate payees.
IPERS provides Model QDRO templates in Microsoft Word and QDRO Instruction Packets in a PDF (to be used in conjunction with the IPERS Model QDROs). There are separate documents depending on your client’s retirement status. People still working in IPERS-covered employment should use the Pre-Retirement Model QDRO with the Pre-Retirement QDRO Instruction Packet. Retired IPERS members should use the Post-Retirement Model QDRO with the Post-Retirement QDRO Instruction Packet.
You must discuss with your client the details of the draft QDRO. Make sure you and your client know how it will affect their retirement benefits.
You are ultimately responsible for the order that is filed with the court under your signature, even if you use a third-party QDRO preparer to draft your order. It is your responsibility to understand the meaning of the QDRO and ensure that your client does too.
There are three ways to divide pension benefits in a QDRO: the straight percentage or dollar amount method, the service factor percentage method, or a sum certain.
In deciding how to divide a member’s retirement benefits in a QDRO, it is important to consider two aspects of a member’s benefits: the benefit payable directly to the member (the gross monthly retirement benefit or gross lump-sum refund), and any benefit that might be payable on behalf of the member to someone else after the member dies (pre- and/or post-retirement death benefit payments to beneficiaries).
It is your responsibility to understand the IPERS plan and how the shared payments will affect your client’s benefits. You may want to provide specific information about the QDRO in the divorce decree itself, so you must understand IPERS before the decree is entered.
An order is not designated as a QDRO until IPERS approves or “qualifies” it, even if it is already signed by the judge. In addition to the general legal requirements, IPERS requires the QDRO to include specific language and provisions. If IPERS rejects an order already signed by the court, you will have to file an amended order with the court.
Internal Revenue Code § 414(p) (11), Iowa Code § 97B.39 and Administrative Rules 495 IAC Chapter 16.
No, we are not governed by the provisions of ERISA or most of the provisions of the Internal Revenue Code (IRC) that govern the division of qualified plan assets. Although we use the terms “alternate payee” and “Qualified Domestic Relations Order,” do not confuse those with ERISA or IRC regulations.
IPERS will reject any QDRO that invokes ERISA.
Successor alternate payees are defined as “a person or persons named in a domestic relations order to receive the amount payable to the former spouse under the QDRO if the alternate payee dies before the member.” Successor alternate payees are no longer allowed in IPERS QDROs effective July 1, 2019. All successor alternate payee designations in QDROs prior to July 1, 2019 will be honored by IPERS.