Many large and longstanding employers, like AT&T, General Motors, Hewlitt Packard and Bank of America, have defined benefit pension plans that offer retirement benefits more complicated in their benefit formula than a 401k plan where the participant receives the vested benefit on the distribution date. These defined benefit plans determine benefits out of a combination of service years, compensation and a variety of other factors. These benefits can be substantial and among the property divided in a divorce. Dividing these retirement benefits requires a special court order known as a qualified domestic relations order, or QDRO. A QDRO describes the method to divide the participant’s benefit between the participant and the alternate payee.
The QDRO terms can be critical not only in protecting each party’s financial interest but also to determine the amounts both parties receive. The more complicated a defined benefit plan, the more complicated a QDRO to accurately and fully divide benefits. Many plans, such as AT&T, include extremely complex formulas and often require multiple formulas.
AT&T Retirement Plan QDROs in Dallas and Fort Worth, Texas
Among the retirement plans I have worked with, AT&T may be the most difficult defined benefit plan. It uses a number of formulas for its benefits. Different groups within the company may have multiple benefits within their individual benefits. The relationship between those multiple benefits is complex. Part of this complexity comes from having a union workforce. Additionally, AT&T has added to the complexity by changing benefit formulas over time. The division and reacquisition of regional telephone providers (the baby bells) drives a significant amount of complexity. In addition to a complex benefit formula, AT&T also offers some rare payment methods.
Many divorce lawyers who have dealt with AT&T’s pension plan–particularly family law attorneys dividing benefits in a contested divorce–have found themselves at a total loss trying to wade through AT&T’s messy plan benefits. AT&T’s benefits are confusing and should not be approached without significant expertise in QDROs and retirement plans.
QDRO attorney and divorce attorney in Texas
If you are about to enter into a divorce with AT&T benefits then you should hire an attorney who has experience with AT&T’s plans and knows how to divide the benefits with a QDRO. Before hiring any divorce attorney you should ask about that attorney’s knowledge and expertise with AT&T benefits. Many divorce attorneys have little or no expertise in this area. You can easily waste time and money with a Texas divorce attorney who does not understand these benefits. This may result in receiving significantly less than expected in the divorce.