Understanding QDROs

When a Domestic Relations Order (DRO) from the court instructs you to pay a specified portion of an employee's benefit to an alternate payee, there are a number of things that you have to track. You also must determine whether the order is qualified. If it is, the DRO becomes a Qualified Domestic Relations Order (QDRO). You record information about the alternate payee and the benefit owed to that payee, as well.

There are two aspects to the system's QDRO capabilities:

• On the administrative side, record the DRO and determine if it is qualified. If it is, add the QDRO alternate payees to the system and enter information about the QDRO. You eventually calculate benefits due to the alternate payee and pay them through the same Trustee Extract process that you use to pay retirees.

• On the implementation side, set up the plan rules so that the QDRO calculations work correctly.