Alabama divorce law considers pension benefits marital property if certain criteria are met, meaning that either spouse may or may not be entitled to a portion of the other spouse's pension. Because the division of property during a divorce in Alabama is complex and based on individual circumstances, it's advisable to seek legal counsel to help you navigate and understand the particular nuances of your marital assets and the legal equitable division of those assets.
In Alabama, retirement benefits of either spouse may be counted in the estate of said spouse in specific circumstances. The couple must have been married for a minimum of 10 years during the time the retirements benefits were acquired. Any retirement benefits earned or awarded to either spouse prior to the marriage is not considered marital property and is not counted in the spouse's estate, according to the Code of Alabama. Any interest or appreciation that applies to pension benefits received prior to the marriage are not considered in division of the assets.
The actual percentage of either spouse's pension that can be awarded to the other spouse in an Alabama divorce varies; the judge takes several factors into consideration, including the other spouse's pension or lack of one. The maximum percentage of one spouse's pension that can be awarded to the other is 50 percent, although this maximum typically applies when one spouse does not have his or her own retirement benefits. Equitable division does not necessary mean equal division. Only a divorce attorney can help you estimate the actual percentage of your pension that your spouse may be entitled to. However, even with legal counsel, the judge makes the final decision, unless both parties come to an agreement.
In Alabama, the judge may, at his or her discretion, reduce or disallow the allowable pension award to a spouse if the divorce is granted on the basis of misconduct, such as adultery, substance abuse or spousal abuse. In this way, the judge has the right to consider the surrounding circumstances and divide assets in such a way that financially benefits the victimized spouse.
In the event that the residing judge awards a portion of your pension benefits to your spouse during an Alabama divorce, the amount is not due until you reach the age of 65 or you start receiving retirement benefits, according to the Code of Alabama. As an alternative to this scenario, a lump sum settlement, paid all at once or in installments, can serve as a substitute for the division of pension benefits, if both parties agree.
- The Code of Alabama 1975: Section 30-2-1
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- Internal Revenue Service. "Retirement Topics - QDRO - Qualified Domestic Relations Order." Accessed Feb. 14, 2020.
- Internal Revenue Service. "Publication 575: Pension and Annuity Income," Page 4. Accessed Feb. 14, 2020.
- Internal Revenue Service. "Publication 575: Pension and Annuity Income," Page 39. Accessed Feb. 14, 2020.
Pam Murphy is a writer specializing in fitness, childcare and business-related topics. She is a member of the National Association for Family Child Care and contributes to various websites. Murphy is a licensed childcare professional and holds a Bachelor of Arts in English from the University of West Georgia.