1. Employee and Employer Contributions
401(k) plans include both employee elective deferrals and employer contributions. In many divorces, the QDRO will divide the marital portion of the total balance, but employer contributions may be subject to a vesting schedule.
So, even if the total plan balance is $100,000, only $80,000 of it might be vested and eligible for division. It’s critical that the QDRO reflect the proper valuation date and clearly state how unvested funds are to be handled. Usually, courts divide only vested funds, but some parties choose to wait until more contributions vest before allocating them.

