Divorce Laws and State Pension Plans in Oklahoma

By Heather Frances J.D.

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Oklahoma state employees may qualify for state-administered retirement plans, including the Oklahoma Public Employees Retirement System (OPERS) and other retirement systems for teachers, police officers and firefighters. These retirement plans can be one of the biggest assets in a divorce, and they can be split as part of the divorce process.

Splitting an Oklahoma Pension

Under Oklahoma divorce law, all marital property must be divided equitably, though not necessarily equally. This means that most assets acquired during the marriage, including retirement benefits, must be split fairly between the spouses as part of the divorce. Spouses can agree on a property division plan or, if they cannot agree, the court will divide their assets for them. For example, the spouses can agree to let one spouse keep the marital home while the other spouse gets to keep his retirement plan.

Qualified Domestic Relations Orders

Most retirement plans can only be divided with a Qualified Domestic Relations Order (QDRO), including Oklahoma's state retirement plans. These orders must be issued by the court as part of the divorce case, and they must meet specific requirements before they can be accepted by the plan's administrators. Typically, an OPERS QDRO includes details about the employee spouse such as his name and Social Security number, the date of the marriage and divorce filing, the exact dollar amount to be distributed to the non-employee spouse, and whether the amount includes cost of living adjustments.

Where the Money Goes

A QDRO must describe the way the retirement benefits are to be split, and the spouses can choose to either split the lump sum of the benefits or split the monthly pay out. Oklahoma does not allow spouses to withdraw money at the time of the divorce unless the employee spouse is already receiving benefits. If the QDRO awards a share of the employee's monthly benefit payment, the recipient spouse will only receive benefits until the employee spouse quits and withdraws his accumulated contributions. If the QDRO gives the recipient spouse a lump sum, she only receives that lump sum if the employee spouse quits and withdraws his accumulated contributions. A QDRO can provide both a lump sum and monthly share to ensure the recipient spouse receives a share of the retirement pay whether or not the employee spouse terminates his state employment.

Beneficiary Designations

Divorce may also impact OPERS beneficiary designations and a joint annuitant designation. For example, divorce generally voids the employee spouse's pre-divorce selection of his spouse as his beneficiary. If the employee spouse still wants his ex-spouse to be his beneficiary, he must complete another beneficiary designation form. This prevents the non-employee spouse from receiving OPERS benefits if the employee spouse inadvertently forgets to change his beneficiary upon divorce.