Hernsberger QDRO Law April 2019

Hernsberger QDRO Law April 2019

April 2019

QDRO Law Experts for Your Law Firm

Built on a Philosophy of Education

Before I became a judge, I was a board-certified specialist in family law. Back then, I saw a lot of lawyers working through divorce cases involving retirement assets. It’s no secret that retirement in divorce can be an incredibly complicated topic. On top of that, a qualified domestic relations order — QDRO or “qua-dro” — is very technical. At the time, I was versed in QDROs, though not nearly as versed as I am today. Even then, I had colleagues and other lawyers asking me about QDROs, and there was never a shortage of questions, so I did what I could to answer them. Later on, while serving on the bench, it became clear that few attorneys knew what they were doing in regards to QDROs. If an attorney got something wrong, the client was the one who got hurt. The order would have to be rejected. When I did step down from the bench, I thought about where I wanted to go next. I didn’t want to get back into family law. I had already spent time working through child custody issues and visitation rights on top of divorce and separation. Instead, I turned my attention back to QDROs. I thought about what would happen if I specialized in one specific area of the law. I already had a strong base knowledge I could put to work. Plus, I saw a need in the legal community. Even highly experienced attorneys were making mistakes — and many of those mistakes were early in the QDRO process. I wanted to make a change; attorneys were negotiating the wrong terms or they had missed a small but crucial detail. For instance, they might

spell out that the husband must give the wife $100,000 from his pension plan. The problem is you can’t do that with a pension plan. It’s not as simple as divvying it up like that. But not everyone realizes this. As a result, the QDRO is denied.

“As our firm grows and we work with more clients, it’s become more fulfilling, both personally and professionally.”

QDRO isn’t a one-size-fits-all situation. There is a lot that must be taken into account. I wanted to be an educator for other attorneys and help them avoid the mistakes that can cost their clients a lot. And I can say that is exactly what I have become. As our firm grows and we work with more clients, it’s become more fulfilling, both personally and professionally. On a personal level, there’s a major sense of accomplishment that comes with being an early pioneer in the field — not just in Texas, but the country. We have built proprietary systems and processes, many of which I created from scratch. Professionally, I’m proud of what we have accomplished so far with those systems. We’ve gone beyond preparing documents and made something of a culture shift among lawyers who practice family law. We don’t just prepare documents. At a glance, it may seem like that, but we’re really here to serve as a guide through the entire process of dividing a retirement in divorce. While we can’t necessarily make the documents less complicated, we can take some of the complications out of the process. I don’t want to see attorneys make mistakes in the courtroom — particularly when I know those mistakes can be avoided. Education is the first step in making that happen, and when it comes to QDROs, education counts for a lot.

–Judge Stephen Hernsberger

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Revisiting a Classic In this issue we’re diving into an old classic that helped define the modern personal development genre and has helped millions of readers improve their lives. “The Magic of Thinking Big” flew off shelves when it was first published in 1959, propelling author David J. Schwartz from university professor to foremost authority on ideas feel old hat to modern audiences, the essence of what he wrote in 1959 still rings true today. In fact, one could argue that several core concepts of this decades-old work are even more applicable today. A running theme in Schwartz’s book is the incomparable

‘The Magic of Thinking Big’

motivation. But does his seminal work still hold true 60 years later? Is there still magic in letting yourself think big in the 21st century? In a word, yes. The lessons in “Thinking Big” are broad, but their wide applicability is also what makes them timeless. While today, many authors and motivational coaches — from “influencer” culture to “growth hacking” — focus on whatever is new and shiny, Schwartz focuses on the fundamentals. This can make the opening chapters in “Thinking Big” feel excessively familiar to those who have read other personal development books. The power of positivity and self-confidence may have been groundbreaking ideas back when Eisenhower was president, but today they’re a given. While this may make some of Schwartz’s

benefit of treating people like people. While many personal and business dealings hinge on the power of a handshake, there’s something refreshing about the common human decency of Schwartz’s outlook. So many motivational works today focus solely on personal reflection — “Thinking Big” reminds us that there is great power in simply being good to other people. Perhaps the largest takeaway today’s readers can find here is to take on more and think bigger. “Thinking Big” is replete with real-world success stories of people doing precisely that, from students collaborating to solve supposedly impossible problems to wounded paratroopers making their way across the mountains of Burma toward safety. Whether you’re dusting off an old copy or picking it up for the first time, this classic is still worth a read in 2019.

The 4 Complete Steps of the QDRO Process

Step 2. Submit a draft copy of the QDRO to the plan administrator for pre-approval.

A QDRO is much more than a document. It’s a process. If you prepare a QDRO but don’t walk it through the four steps of the approval process, you might as well not prepare the QDRO at all. It doesn’t matter if you’re a lawyer working on the closing documents after a divorce or you’re a non-lawyer trying to do your own QDRO; these steps will take you to the finish line. We maintain a very large library of retirement plan documents, summary plan descriptions, QDRO approval processes, and model QDROs for thousands of retirement plans — and the library grows daily. We use these documents, the biographical information you supply us, and the specific language of the divorce decree to prepare your QDRO in compliance with Texas law, federal law, and the specific provisions of the retirement plan. Step 1. Prepare the QDRO.

Not all plan administrators will pre-approve a QDRO, but if the plan administrator offers this service, you should take advantage of it. If they pre-approve the QDRO, you can be sure they will approve it after the judge signs it. If they reject the QDRO, they’ll tell you exactly why they rejected it. We can then revise the QDRO to satisfy them (at no additional charge) and still protect your client’s rights before you take it to the judge. The version of the QDRO that you send to the plan administrator should have the addendum attached to it. They will need the information on the addendum to review the QDRO. Before you decide to have the QDRO pre-approved, you should know that many plan administrators take 30–60 days to review your QDRO. This can be a problem if you are in a hurry to get to court.

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Step 3. Present the QDRO to the court for approval.

Be Inspired

In Texas, the court that granted the divorce retains continuing exclusive jurisdiction to render a QDRO.

The best practice is to present the QDRO to the court at the same time you present the divorce decree. If you submit the QDRO to the court after the decree has been entered, Section 9.102 of the Texas Family Code provides a specific procedure that you must follow to submit the QDRO to the court. Failure to follow the Section 9.102 procedure will likely cause the QDRO to be void. Make sure the addendum IS NOT attached to the QDRO when you present it to the judge. If it is, your personal information — including Social Security numbers — may become available to the public. This step is not included in our $600 QDRO preparation fee, nor do we provide coaching services to non-lawyers on how to complete this step. The Hernsberger Law Firm can prepare the QDRO and represent you through the entire QDRO approval process anywhere in Texas at our normal hourly rate discussed in QDRO litigation services. We also work with hundreds of lawyers throughout Texas, so we can likely refer you to a knowledgeable lawyer in your area to handle this step for you. After the judge signs the QDRO, it will be filed with the district clerk. You should request a certified copy of the signed QDRO from the district clerk and mail it to the plan administrator. When we prepare the QDRO, we will supply you with the mailing address of the plan administrator. Before you mail the certified copy of the QDRO, be sure to attach the addendum to it. The plan administrator will not be able to process the QDRO without the information contained in the addendum. This step is not included in our $600 QDRO preparation fee. However, we can obtain a certified copy of the QDRO from the district clerk of any county and submit it to the plan administrator for you (there is an additional fee for this service). Step 4. Present a certified copy of the signed QDRO to the plan administrator for approval.

As a general rule, expect the plan administrator to act on your QDRO within 4–6 weeks.

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INSIDE This Issue

Built on a Philosophy of Education PAGE 1 Discover ‘The Magic of Thinking Big’ The Facts of the QDRO Process PAGE 2

Take a Break PAGE 3

The Curious Case of the Disappearing Flags PAGE 4

An Inside Job THE CURIOUS CASE OF THE DISAPPEARING FLAGS

Theft is a serious matter, made even more grave when the victims are fallen war heroes. Such was the situation that stumped police in Hudson, NewYork, in 2012.

Determined to find out who was to blame, police put up surveillance cameras and recorded the goings-on in the cemetery. As they watched the tapes, sure enough, they saw one of the culprits sitting atop a gravestone with an empty flagpole in front of him. It was a groundhog. Apparently, the wooden flagpoles attract groundhogs, something other groundskeepers have experienced as well. “I’m glad we don’t have someone who has taken it upon themselves to desecrate the stones and the flags in front of them,” said Hudson mayor Bill Hallenbeck. “We can all rest a little easier knowing that it was a critter and not a human defacing our flags, especially those of the veterans,” added Hudson’s police commissioner. Turns out Punxsutawney Phil has some very naughty cousins — ones who aren’t subject to the law.

The crime was first committed in July of the previous year. Flags had been placed around the graves of soldiers in Cedar Park Cemetery — only to go missing right around Independence Day. Veterans groups and locals were outraged and mystified by the crime. Some worried that a hate group was to blame, as the missing flags had adorned the graves of Jewish soldiers. Veterans worked to replace the flags, one by one, and right the wrong. No culprit was found, and the community moved on — until the following July, when the mystery repeated itself. Like the year before, flags were placed on veterans’ graves in honor of Independence Day, and again, they went missing sometime in the night, this time taken from the graves of African American Civil War soldiers. Cemetery caretaker and veteran Vincent Wallace was appalled, as was the rest of his community. “I just can’t comprehend the mindset that would allow someone to do this,” Wallace said.

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