In divorce cases in Virginia, the division of assets, including the Thrift Savings Plan (TSP), is typically governed by state law. The Thrift Savings Plan is a retirement savings plan for federal employees, including members of the military. When dealing with the division of TSP in a Virginia divorce, certain steps and legal procedures need to be followed:
Identification of Marital Property: The first step is to identify whether the TSP is considered marital property. Marital property generally includes assets acquired during the marriage, and in Virginia, it is subject to equitable distribution.
Court Order: To divide the TSP, a court order known as a "Retirement Benefits Court Order" or a similar legal document must be issued. This court order is similar to a Qualified Domestic Relations Order (QDRO) used for private retirement plans. The court order outlines how the TSP should be divided between the spouses.
QDRO-Like Document: Although the TSP is a federal retirement plan, it does not technically use a QDRO. Instead, it employs a document known as a "Retirement Benefits Court Order" (RBCO), which serves a similar purpose to a QDRO. This document should be prepared carefully to meet the specific requirements of the TSP.
TSP Processing: Once the court order is issued, it needs to be submitted to the TSP for processing. The TSP will review the order to ensure it meets their requirements before implementing the division.
Tax Considerations: It's essential to consider the tax implications of the TSP division. Depending on the terms of the divorce settlement and the court order, the division may or may not incur tax consequences for either party.
Legal Assistance: Given the complexity of dividing retirement accounts, including the TSP, it is highly advisable to seek the assistance of a qualified family law attorney. An attorney can help ensure that the necessary legal documents are prepared correctly and that the division is carried out according to the applicable laws.
It's important to note that laws can change, and individual circumstances may vary. Therefore, individuals involved in a divorce, especially one involving federal retirement plans like the TSP, should consult with a family law attorney familiar with Virginia state law and federal retirement regulations to ensure the proper legal procedures are followed. The attorneys at AMG LAW are experienced in dealing with all aspects of military divorce, including the division of the Thrift Savings Plan. Contact us at 540-208-5299 or 703-982-0076 to schedule a consultation with one of our military divorce attorneys today.
Anneshia Miller Grant has over 13 years practicing family law in Virginia. She is experienced in handling every type of family law matter, including custody, support, separation, protective orders, military and high asset divorce cases. Ms. Miller Grant represents clients all over Northern Virgin...