Employee Contributions vs. Employer Contributions
401(k) plans typically consist of two parts: employee deferrals and employer matches or profit-sharing contributions. It’s common for divorce orders to divide only the vested portion of the account. However, if employer contributions are not fully vested, the alternate payee could lose part of their share unless the QDRO is written wisely.
- We recommend specifying inclusion or exclusion of unvested amounts.
- Consider language stating that if amounts become vested later, the alternate payee will share in those increases.

