How will my divorce affect my individual retirement arrangements (IRAs)?
Nutley, New Jersey estate planning and probate attorney, Brad Micklin, talks about how divorce might affect your IRAs.
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Well, divorce won’t have much of an effect on the IRA itself unless it’s been divided as an asset, an equitable distribution. Most transfers in the IRA transfer in a divorce are transfers that are not subject to tax and they don’t trigger any tax consequence, but the rollover can, if it’s not being rolled over into an equally qualified tax exempt account. So the other spouse needs to open an account that mirrors that type of protection and roll it over. If the spouse elects just to take the withdraw, he or she would probably pay the penalty and taxes and fees.