In a divorce, retirement accounts are often some of the largest assets. When one of the spouses has a pension, that pension may be included as a marital asset that must be divided equitably between the parties. In New York, the courts typically use the Majauskas formula to divide a pension.
How does the court divide a pension in divorce?
The courts use Qualified Domestic Relations Orders (QDRO) to divide marital pensions during a divorce. In order to determine what to put in the QDRO, the court typically uses a mathematical formula called the Majauskas formula.
The Majauskas gives each spouse half of the credits towards the pension that are earned during the marriage. The spouse who earns the pension keeps all of the credits that are earned before the marriage. However, the parties evenly split the months of credits that occur during the marriage. Then, the percentage that each party receives is calculated against the value of the pension and the total months of service credit.
Does a New York court have to use the Majauskas formula to divide a pension?
No, a New York court does not have to use the Majauskas formula to divide a pension. Although the calculation may provide an amount that represents half of the marital portion of the pension, the court does not have to give each party that amount.
A court must award each party an equitable share of the assets, including retirement accounts. The court may decide that it is more appropriate to award a party more or less than exactly 50%. In all cases, the court issues an order for how to divide the pension. That amount is stated in the QDRO document and is submitted to the plan administrator for division.
Dividing a pension in divorce
When you understand how the courts divide a pension in a divorce, you can advocate for a fair division of the assets. A pension is one asset that may be included in divorce. A fair divorce judgment should take all assets and debts into account.