Unfortunately the pressures of federal employment can cause a stress upon one’s relationships, and sometimes that can lead to a divorce. If the next chapter of your life includes a divorce, there will probably be some difficult emotional issues to overcome; there will certainly be some extremely important financial consequences that should not be overlooked.
Many federal employees don’t think about their legal rights to financial assets and maintenance associated with their work until they go through a divorce. This right applies not only to your expected retirement from work, but also in other situations, such as obtaining the benefits earlier than expected due to Office of Personnel Management (OPM) Federal Disability Retirement.
Understanding the Impact of Divorce on Federal Disability Retirement Benefits
Federal employees typically develop a retirement program either with the Civil Service Retirement System (CSRS) or with the Federal Employees Retirement System (FERS). In either case the retirement program is a right that has been growing during the time of your work life which probably overlaps with time in the marriage and, therefore, should be addressed at the time of a divorce.
Federal law, at the U.S. Code of Federal Regulations, Title 5, Section 838.101 (a) (1) states that the OPM must comply with court orders in connection with divorces, annulments of marriage, or legal separations of employees, members, or retirees of the CSRS or the FERS, if the divorce decree awards a portion of the former employee’s retirement benefits, including a survivor annuity.
Personnel at the OPM will request a copy of the official court order of any divorce decree that occurred during your marriage and then determines whether or not the order is created in an acceptable manner. Therefore it is important that the divorce decree includes the proper language to clarify the extent of any award of that asset. For example, the decree may include language that a former spouse or survivor receives any amount they would have received if the marriage had never been terminated by divorce.
The assignment of the benefits is often expressed to take effect on the date of the court order. One should note that if a federal worker leaves federal employment and dies before retirement, no survivor annuity will be paid. The only benefit to be paid in that scenario would be a refund of contributions, and that goes to the person named as beneficiary. If no beneficiary is named, close relatives rather than a former spouse would be eligible for the lump sum payment.
Importance of Legal Guidance during Divorce
If these matters are not addressed at the time of the divorce people often find that it is both expensive and be difficult to later amend or correct the court’s order. Therefore, it is very important that your divorce lawyer is competent in these matters and gets the legal wording correct the first time.
If not, you and your ex-spouse may sustain unintended consequences; which will simply make a difficult situation worse. We suggest that you develop a good plan as early as possible, so your the next chapter has a happy ending.
Schedule a free consultation with our team today to learn more about Federal Disability Retirement and how we can help.
