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New rules regarding dividing a PERA

On Behalf of | May 13, 2020 | Divorce, Property Division

If you are going through a divorce and you or your spouse have a Colorado Public Employee’s Retirement Account (PERA), you will need separate court orders in order to divide the plan. To properly split the account and confirm each spouse’s right to a portion of the money, you will need a Domestic Relations Order (DRO).

Although DRO forms may seem straight forward at first glance, one minor deficiency or oversight can cause the entire order to be rejected. In addition to the inconvenience and hassle associated with redrafting the QDRO, such delay could result in a violation of the 90-day deadline as outlined in C.R.S. 14-10-113(6)(c)(1). Until now, this statute held that you must submit a conforming QDRO within 90 days after the divorce decree is issued.

Now, for the first time, PERA announced an exception to the 90-day requirement in response to the global health crisis which is limiting court hours and services. In short, PERA Rule 15.25A, which implements the 90-day requirement, has been temporarily suspended as follows:

1. For any Colorado divorces for which the divorce decree and permanent orders were entered by the court or after December 16, 2019, the PERA Domestic Relations Orders and Agreement may be entered by the court by December 31, 2020, without violation of the 90-day deadline for entry of the Domestic Relations Order in PERA Rule 15.25A.

2. PERA Rule 15.25A requires that the certified copies of both the DRO and Agreement must be submitted to PERA within 90 days after entry of the DRO and Agreement. That deadline is suspended and PERA will accept certified copies beyond the 90-day deadline for any DROs and Agreements entered by the court on or after December 16, 2019.

Please note, however, that certified copies of the DRO and Agreement must be submitted to PERA before PERA can make any payment to the alternate payee. Further, PERA must receive the certified copies at least 30 days before payment will commence in the defined benefit plans under C.R.S. 14-10-113(6)(c)(II)(L).

Authored by: Tyler Lambert, Associate Attorney