Dividing an ESOP with a QDRO: What You Should Know About the Touchpoint, Inc.. Employee Stock Ownership Plan
When a marriage ends, dividing retirement accounts is one of the most complex financial steps—especially when one of those accounts is an Employee Stock Ownership Plan (ESOP). The Touchpoint, Inc.. Employee Stock Ownership Plan isn’t your typical 401(k) or pension. It’s a company stock-based retirement benefit with unique rules about valuation, distribution, diversification, and stock repurchase. For divorcing couples, a court order known as a Qualified Domestic Relations Order (QDRO) is crucial for splitting this type of asset correctly.
This article will explain how QDROs work for the Touchpoint, Inc.. Employee Stock Ownership Plan, what makes ESOPs different, and what you need to prepare for a successful division during divorce.
Plan-Specific Details for the Touchpoint, Inc.. Employee Stock Ownership Plan
- Plan Name: Touchpoint, Inc.. Employee Stock Ownership Plan
- Sponsor: Touchpoint, Inc.. employee stock ownership plan
- Address: 20250806074142NAL0001600483001
- Plan Year: 2024-01-01 to 2024-12-31
- Plan Established: 1977-01-01
- Plan Type: ESOP (Employee Stock Ownership Plan)
- Industry: General Business
- Organization Type: Corporation
- EIN: Unknown
- Plan Number: Unknown
- Status: Active
- Plan Participants: Unknown
- Assets: Unknown
Although the EIN and plan number are currently unknown, you—or your attorney—will need to request this information before your QDRO can be submitted or processed by the plan administrator. These are usually found on your spouse’s annual ESOP statement or the plan’s Summary Plan Description (SPD).
What Makes the Touchpoint, Inc.. Employee Stock Ownership Plan Different from Other Retirement Plans?
Traditional retirement plans like 401(k)s or pensions provide cash or cash-equivalent payouts. ESOPs like the Touchpoint, Inc.. Employee Stock Ownership Plan function differently. They involve equity in the sponsor company itself and are governed by special rules under Internal Revenue Code § 409 and ERISA § 404.
Here are some characteristics that impact QDROs for this plan:
- Stock-Based: Plan participants own company stock, not cash. Valuations occur once a year, so the timing of your QDRO affects the fair market value allocated.
- Diversification Rules: Some ESOPs allow participants to convert stock to cash at a certain age or service threshold—critical for divorcing parties who prefer liquidity over stock.
- Put Option Rights: If stock is distributed instead of cash, the company must buy back the shares at fair market value under specific conditions. This protects a divorced spouse from holding illiquid investments.
- Distribution Timing: ESOPs commonly restrict when and how distributions are made, often tying it to separation from service, death, disability, or plan-specific rules tied to internal valuations.
QDRO Requirements for ESOPs Like Touchpoint, Inc.. Employee Stock Ownership Plan
Unlike a pension or 401(k), dividing an ESOP with a QDRO can’t be approached with a generic template. The administrator of the Touchpoint, Inc.. employee stock ownership plan will look for a precise description of how company stock should be handled in divorce to remain compliant with the law and the plan’s internal rules.
Elements a Good QDRO Should Include:
- Clear Identification of Plan: Must include “Touchpoint, Inc.. Employee Stock Ownership Plan” and reference the correct plan number and EIN (once determined).
- Stock Valuation Date: Since ESOP shares are valued annually, make sure the QDRO specifies either a specific valuation date or explains how to calculate the award based on available plan statements.
- Distribution Method: Indicate whether the alternate payee (the non-employee spouse) will receive shares of stock or the cash value equivalent, and how soon they are eligible for distribution.
- Put Option Use: If stock is transferred, outline whether the alternate payee has a right to require the company to repurchase it.
- Diversification Rules: Factor in any plan-specific diversification rights that may impact timing or type of distribution.
- Timing of Payout: Clarify whether distribution should happen immediately upon divorce, or later, such as when the employee separates from service.
Common Pitfalls When Splitting an ESOP in Divorce
Because ESOPs are less commonly understood than pensions or 401(k)s, divorcing couples often run into preventable mistakes. Here’s what to watch for with the Touchpoint, Inc.. Employee Stock Ownership Plan:
- Mistiming the Valuation: If you use outdated valuation data, the alternate payee could end up with more or less than intended. Refer to the most recent valuation report and understand when the next valuation occurs.
- Not Addressing the Put Option: If the alternate payee receives stock, the QDRO should state whether they can use the plan’s put option for repurchase, and the terms for that option.
- Leaving Out Distribution Elections: Failing to define when and how distributions occur can leave the alternate payee waiting years, depending on company rules and termination requirements.
- Generic QDRO Forms: Many QDROs fail because they use boilerplate language not tailored to the specific requirements of an ESOP like this one. Mistakes cause delays and require court resubmission.
Why Work with a QDRO Specialist?
At PeacockQDROs, we’ve completed thousands of QDROs from start to finish. That means we don’t just draft the order and leave you to figure out the rest. We handle the drafting, preapproval (if required), court filing, submission to the administrator, and follow-up until the benefits are finally divided. That’s what sets us apart from firms that only prepare your 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. We’re also highly familiar with the nuances of ESOP-specific plans, like the Touchpoint, Inc.. Employee Stock Ownership Plan.
Want to avoid common errors? Read our article on common QDRO mistakes.
Learn How Long It Might Take
The time it takes to complete the QDRO process can vary widely based on the type of plan, administrator responsiveness, and court rules. Read our breakdown of the 5 factors that determine QDRO timing.
To get started or get answers to your questions, visit our QDRO service overview at https://www.peacockesq.com/qdros/ or contact us directly.
Important Takeaways for Dividing the Touchpoint, Inc.. Employee Stock Ownership Plan
ESOPs like the Touchpoint, Inc.. Employee Stock Ownership Plan are stock-based, timing-sensitive, and require a level of QDRO planning many traditional family law attorneys aren’t equipped to offer. Whether you’re the participant or the alternate payee, your rights to accurate valuation, stock allocation, and distribution must be protected.
Don’t let preventable errors delay your divorce settlement or cost you part of your entitled share. Work with someone who understands exactly how these plans work and what paperwork is required for compliance.
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 Touchpoint, Inc.. Employee Stock Ownership 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.