With few exceptions, pensions are marital property. As marital property, they’re subject to division when a couple divorces. This rule is pretty much universal, but things get interesting when it comes to how different states divide such assets. In community property states, it’s simple: the division is 50-50. However, Florida is an equitable distribution state, so it comes down to the discretion of a judge.
Marital versus Non-marital Property
Florida law draws a line between marital and non-marital property -- and it can be pivotal to the equitable distribution of a pension. Non-marital property includes assets you owned before you married. If you worked toward your pension before you tied the knot, this portion of its value is not marital property, so your spouse is not entitled to it. If you worked toward it and left that job before you married, no longer contributing to it, none of the pension is marital property -- and it’s not subject to division in a divorce. There’s also a statutory cutoff for marital property. In Florida, anything you acquire or earn after you file a petition for divorce becomes non-marital property. Your pension’s value when you file for divorce, less the contributions you made before you married, is what the court considers as marital property and divides in a divorce.
Equitable Distribution Factors
After the marital portion of your pension is determined, the court must decide how to equitably distribute it, based on factors cited in Florida’s statutes. A judge must consider these factors when making the division, but in the end, the distribution will come down to what he thinks is fair. The judge must begin with the assumption that a 50-50 division is equitable, but he can then adjust that to accommodate factors unique to your marriage. One important factor is how long you were together. The longer the duration, the more likely it is that he’ll order a 50-50 distribution. Judges can consider non-economic contributions to the family such as if your spouse took care of the home and kids while you worked and earned the pension. This counts as a contribution to acquiring the asset.
Marital misconduct, such as adultery or cruelty, is not taken into consideration when dividing pensions or other assets in Florida, which is a pure no-fault state. You can’t file for divorce on fault grounds -- and misconduct isn’t an equitable distribution factor, but one exception exists. If you dissipated other marital assets, wasting them such as by running up gambling debts, Florida’s equitable distribution law allows judges to compensate your spouse for this by giving her additional property because she had a right to a portion of what you lost.
Distribution of Benefits
The distribution of your pension benefits to your ex when you retire falls under federal law. Assuming that she receives 50 percent, half your pension payments would go to her and you’d receive the remaining 50 percent. But the Employee Retirement Income Security Act of 1974, known as ERISA, prohibits pension benefits from going to anyone other than the individual who earned them. A qualified domestic relations order, known as a QDRO, is necessary to override this provision. If your divorce decree orders that a portion of your benefits should go to your ex, you'll need to have a QDRO prepared, approved by your plan administrator, then signed by the judge to allow your ex to receive her share.