1. Traditional vs. Roth Contributions
401(k) plans can include both traditional pre-tax contributions and Roth after-tax contributions. These are treated very differently for tax purposes—and your QDRO needs to address both correctly.
- Traditional 401(k): Tax-deferred; alternate payee pays taxes upon withdrawal.
- Roth 401(k): Tax-free if withdrawal rules are met; alternate payee may owe no taxes.
Your QDRO should separately allocate Roth and traditional funds unless you’re directing a percentage of the whole account regardless of type. It’s critical to know what’s being divided and how it affects each spouse’s tax situation.

