Your Rights to the 24g 401(k) Plan: A Divorce QDRO Handbook

The 24g 401(k) Plan is a defined contribution plan, meaning the participant and possibly 24g, LLC as the employer contributed money into the account. In a typical QDRO, both these contribution types can be divided between the plan participant and the alternate payee (usually the ex-spouse).

When dividing this plan, consider the following:

• The total account balance as of a specific date (often the date of separation)
• Whether you’re using a flat dollar amount or a percentage
• Clarifying whether you’re dividing just the marital portion or the full account

Employer contributions are often subject to a vesting schedule—meaning the participant must work for 24g, LLC for a certain number of years before earning the right to keep those contributions. Any unvested portion may be forfeited when employment ends.

A QDRO must protect the alternate payee from losing their share due to the participant’s incomplete vesting. At PeacockQDROs, we make sure to clearly identify how vested and unvested portions should be treated in the order, especially if the participant separates from 24g, LLC before full vesting.

If the participant has taken out a loan against their 401(k) balance, things can get tricky. Loans lower the available account balance and are considered a plan liability. A properly drafted QDRO should state whether:

• The loan balance is to be included or excluded when calculating the alternate payee’s share
• The loan affects only the participant’s portion of the account

This is a crucial detail and one of themost common QDRO mistakes we see when orders are drafted without experience.

Many modern 401(k) plans let employees choose between pre-tax (traditional) and after-tax (Roth) contributions. If the 24g 401(k) Plan allows Roth contributions, your QDRO should divide these separately from traditional funds, since the tax treatment at withdrawal is very different.

If you’re the alternate payee, your share of Roth funds must be rolled into a Roth IRA to preserve the tax-free growth. Failing to distinguish between the types of contributions can lead to avoidable tax consequences. We know how to do this right.

To start, you’ll need a copy of the 24g 401(k) Plan’s Summary Plan Description (SPD) or QDRO procedures. These can often be obtained from the plan administrator or HR department at 24g, LLC. If the administrator requires pre-approval of QDROs, we take care of that for you.

A properly drafted QDRO for the 24g 401(k) Plan needs to include:

• Participant and alternate payee names and addresses
• Participant’s Social Security Number (not filed publicly)
• Plan name (24g 401(k) Plan), sponsor (24g, LLC), EIN, and Plan Number (required)
• A clear method of division (e.g., 50% of the marital portion as of 12/31/2023)
• Direction for dividing Roth vs. traditional balances (if applicable)

Once the QDRO is drafted, it must be signed by the judge in your divorce case. After that, it’s submitted to the plan for approval and processing. At PeacockQDROs, we take care of that whole process for you. We know that submitting the order isn’t the end—it often takes months of follow-up to get funds distributed and timelines vary depending on the plan. Learn abouthow long it typically takes to process a QDRO.