The Texas State Disbursement Unit is a facility in San Antonio that collects and records child support payments. In a child support order, the court will order that all child support shall be paid to the State Disbursement Unit and then forwarded to the custodial parent.
Once the Disbursement Unit receives the support, it can remit by direct deposit that money into the custodial parent’s bank account. This keeps everything very convenient for both parties. Sometimes parties get along and the paying parent just sends money directly to the other parent or pays for items directly (school tuition, child care, etc.), however this has the potential for causing problems later on. For instance, there can be disagreements over what has been paid and when. If child support payments are sporadic or inconsistent they can be difficult to keep track of. The benefit to having the money sent through the Disbursement Unit is there is an accurate record of all support payment amounts and the date those payments were made. The State Disbursement Unit helps protect paying parents who send in child support and helps custodial parents show any support not paid. Often times, the 401k or other similar retirement account is one of the most valuable assets in a marriage and must be carefully considered as to what is a proper division. The 401k which is subject to the just and right division of Texas Family Code should be considered along with the other assets in a community estate.
As with all other assets acquired during the marriage, the part of the retirement account earned during the marriage is generally community property. If part of the account was earned prior to the marriage, then that portion would be separate and not subject to division. Once the parties have agreed on a division of the account or the court has ordered specific portions to each party, the account must be actually divided. This is accomplished through a Qualified Domestic Relations Order (“QDRO”). The QDRO tells the retirement plan administrator to divide the account in accordance with the divorce decree. For example, a divorce decree might say each spouse is awarded 50% of the 401k value as of the date of the divorce. If the plan is worth $100,000 then the administrator would then divide the account into two $50,000 accounts. The spouse whose employment is related to the plan (owner) can continue to work and accumulate more value into the plan. The non-owner spouse would then have 3 options related to the account. The non-owner could cash out the account, rolling the account into an IRA or other similar account in his or her own name, or leave the money in the current plan and take distribution when the owner retires. Because the 401K or other retirement account is often such a large asset it is important to speak with an attorney to help decide what you are entitled to and what a proper division would be. The decision of what to do with the that account can also have tax consequences so you will want to speak with your accountant or financial planner to decide the best method for you and what the tax consequences would be. |
AuthorMichael Diaz Archives
February 2023
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