Understanding How the Springbig 401(k) Plan Is Divided in Divorce
If you or your spouse has a retirement account through Springbig, Inc.., that account—called the Springbig 401(k) Plan—may be subject to division as part of your divorce. Like many employer-sponsored retirement accounts, a 401(k) can be divided using a specialized court order known as a Qualified Domestic Relations Order, or QDRO. This article explains exactly what that means for the Springbig 401(k) Plan, how QDROs work, and what to watch out for when drafting and processing one.
Plan-Specific Details for the Springbig 401(k) Plan
When preparing a QDRO for this plan, it’s important to understand its specifics. Here’s what we know about the Springbig 401(k) Plan:
- Plan Name: Springbig 401(k) Plan
- Plan Sponsor: Springbig, Inc..
- Address: 20250704114040NAL0002160576001
- Effective Date: 2024-01-01
- Employer Identification Number (EIN): Unknown (required when submitting a QDRO)
- Plan Number: Unknown (also required in QDRO submission)
- Industry: General Business
- Organization Type: Corporation
- Plan Year: Unknown
- Status: Active
This plan is a typical defined contribution 401(k), which means it can hold pre-tax (traditional) and post-tax (Roth) contributions and may include both employee and employer contributions, each of which is treated differently when preparing a QDRO.
Why a QDRO Is Needed to Divide the Springbig 401(k) Plan
A divorce decree alone is not enough to divide a 401(k). A properly drafted QDRO is needed to instruct the plan administrator to separate part of the account to a spouse without triggering early distribution taxes or penalties. This is federally required under ERISA and the Internal Revenue Code.
Key Components of a QDRO for the Springbig 401(k) Plan
Employee vs. Employer Contributions
The Springbig 401(k) Plan likely includes pre-tax employee salary deferral contributions and may offer employer match or profit-sharing contributions. QDROs must make clear whether they divide only earnings contributed by the participant or include employer amounts too.
A typical division strategy is to split the total account accumulation from the date of marriage to the date of separation (or another court-approved date), including both employee and employer contributions made during that time.
Vesting of Employer Contributions
One of the most overlooked issues in QDRO preparation is vesting. Unvested employer contributions can’t be awarded in a QDRO. If the plan includes a vesting schedule and the participant is not fully vested at the time of divorce, the alternate payee (usually the ex-spouse) won’t receive the unvested amount—even if those unvested funds relate entirely to the marital period.
It’s critical to clarify with the plan administrator what portion of the account is vested and only divide those portions accordingly.
Dealing with Outstanding Loan Balances
The Springbig 401(k) Plan may allow participants to borrow from their accounts. If a loan exists, there are two main QDRO approaches:
- Divide net of the loan: Only the available balance is split, and the loan stays with the participant.
- Divide including the loan: The loan balance is treated as part of the retirement asset and included in the marital value.
This choice can significantly affect what each party receives. A QDRO must clearly state how to handle the loan, otherwise the plan administrator may reject it or apply defaults you may not want.
Roth vs. Traditional Accounts
If the participant in the Springbig 401(k) Plan has contributed to a Roth account, the tax treatment is different than traditional contributions. Roth funds are after-tax and grow tax-free. A QDRO can specify whether each account type is divided proportionally or in a specific allocation. Be careful here—an incorrectly drafted QDRO that omits these distinctions can result in IRS reporting errors or unintended tax consequences.
What You’ll Need to Submit a QDRO
To divide the Springbig 401(k) Plan using a QDRO, you typically need the following:
- A certified copy of your divorce judgment
- Accurate legal names, addresses, and Social Security Numbers of both spouses (usually provided directly to the administrator, not in the QDRO)
- The name of the plan—”Springbig 401(k) Plan”
- The EIN and plan number (these must be obtained from the plan administrator for a valid submission)
Many plans also require pre-approval of the QDRO draft before court filing to avoid unnecessary delays.
Avoiding Common QDRO Mistakes
Mistakes in QDROs can delay processing for months—sometimes years. Common pitfalls include:
- Failing to include vesting limitations for employer contributions
- Incorrect or missing plan number or EIN
- Omitting Roth vs. traditional account distinctions
- Not mentioning how loan balances should be treated
- Submitting a QDRO that hasn’t been pre-approved when required
We’ve broken down more frequent issues on our page here: Common QDRO Mistakes.
How Long Will a QDRO Take?
The QDRO process timeline depends on several factors: whether the plan requires pre-approval, how quickly the court processes the signed order, and how responsive the administrator is. We’ve outlined the 5 biggest timing factors here: 5 Factors That Determine How Long It Takes to Get a QDRO Done.
Plan Type Tips for Corporations and General Business Plans
Since Springbig, Inc.. is organized as a Corporation in the General Business sector, their plan will typically be administered by a third-party administrator (TPA) or financial services firm. These plans follow standard ERISA requirements but may have customized internal procedures. Always verify whether pre-approval is required and get submission details from the plan administrator before filing in court.
Why Choose PeacockQDROs for the Springbig 401(k) Plan
At PeacockQDROs, we’ve completed thousands of QDROs from start to finish. That means we don’t just draft a QDRO and leave you to figure out the rest—we handle every step: drafting, preapproval (if applicable), court filing, submission, and final follow-up with the plan administrator. That’s what sets us apart from firms that only prepare the document and hand it off to you.
We maintain near-perfect reviews and pride ourselves on a track record of doing things the right way. Our goal is to make sure you get your rightful share—nothing more, nothing less—without surprises or delays.
Learn more about our services at PeacockQDROs QDRO Resources, or get in touch with us directly using our contact form if you’re ready to start.
Final Thoughts
Dividing retirement during divorce is never simple—but it gets even trickier with the details involved in 401(k) plans like the Springbig 401(k) Plan. Vesting schedules, account types, loan obligations, and tax treatments all need to be considered carefully before finalizing your QDRO. A small error now could lead to big problems later—whether in taxes, delayed payments, or even rejected orders.
Smart planning and precise drafting are key. Don’t guess. Don’t assume. Work with qualified professionals who know the ins and outs of the QDRO process and who can guide you properly from start to finish.
Contact Us If You Were Divorced in a Covered State
If your divorce was in California, New York, New Jersey, Connecticut, Kansas, Missouri, Iowa, or North Dakota, and you have questions about qualified domestic relations orders or dividing retirement assets like the Springbig 401(k) Plan, contact PeacockQDROs. We specialize in QDROs and have successfully processed thousands of orders from start to finish.
Get the answers you need—explore our QDRO resources or reach out for personalized help if you’re in one of our service states.