Posted by Nydia Streets of Streets Law in Florida Divorce
How is a retirement account divided in a Florida divorce? Usually, the marital portion is divided, and this consists of the value of the account on the date of filing for divorce minus the value of the account as of the date of marriage. The value of the account as of the date of marriage is considered the separate, non-marital property of the spouse who owns the account. How about interest on the non-marital portion of the account? This was an issue in the case Balazic v. Balazic, 5D21-1804 (Fla. 5th DCA December 22, 2022).
The parties agreed in their divorce to equally divide the marital portion of the former husband’s retirement account which they defined as acquired from the date of marriage until the date of filing the petition for dissolution. They also agreed to divide “any gains or losses on that amount.” The parties disputed interpretation of this clause, which resulted in the trial court entering an order granting the former wife’s motion for enforcement. The former husband appealed.
The former husband argued it was error for the trial court to subtract the non-marital portion of the account from the account total as of the date of filing the divorce petition, and then to divide that total in half. He reasoned this resulted in the former wife receiving passive interest on the non-marital portion of the account. The appellate court agreed with him. It held “We hold that the contractual term ‘plus any gains or losses on that amount’ does not apply to any passive appreciation in Former Husband’s nonmarital portion of the retirement plan. Accordingly, the order under review and the resulting QDRO are reversed. This matter is remanded for the entry of a new QDRO that subtracts Former Husband’s $17,485 premarital balance, plus that amount constituting passive appreciation on this premarital balance, from the final sum of $549,975, and then equally divides the remaining net amount between the parties.”
If you want to know how much of your retirement account may be divided at divorce, schedule a consultation with a Miami family law attorney for specific guidance.