Any lawyer who has taken on a divorce client in Michigan knows the statutory language and other statutory requirements from the start of the action through the Judgment of Divorce. But, many lawyers are not well-versed in the specific requirements and language necessary to effect an attachment to a military spouse's "accounts" or pension(s). Here are just a few gotchas that can trip up any attempt to divide a military pension through a court order:
- A military pension is not a pension in regards to ERISA and is not affected by a QDRO. When submitting the court order and other documentation of the judgment to the military, you do NOT use a QDRO. Furthermore, if the member has more than one pension or Savings Plan, you must specifically identify (with the proper account names) which accounts are to be effected.
- Dividing a military pension must be done with specific language so that the military finance department can determine how exactly to pay out on the court order. The court order dividing retirement pay may be rejected (and frequently are rejected) for failure to provide this specific guidance.
- No "offsets" are allowed to the pension division. If the amount of the former spouse’s award is expressed as a dollar amount or percentage of disposable retired pay less the amount of some other obligation (e.g., Survivor Benefit Plan premium or the former spouse’s child support obligation), the entire award is unenforceable.
There are also myriad issues regarding the unvested retirement plan (military retirement is not vested until the member has 20 years of service (20 "good years" for the reserve components).
-What if the service member never gets to 20 years of service, and therefore has no retirement? What if the member takes a "buy out" to separate from the military (as has been done in past "drawdowns") and in turn also forfeits his retirement pension?
-What if the servicemember dies before the ex-spouse? Under the military pension, the pension is terminated for that member AND any ex-spouse receiving part of the pension, unless a specific action is taken from a court order that specifically addresses that possibility prior to the member's death.These are just a few of the landmines one must navigate to properly execute a split of marital assets when there is a military pension involved