You are allowed to use 401k money to fund your divorce. A 401k and other types of retirement money are “property” for purposes of divorce. And in MA, all property owned by either party is considered for division. Therefore any money in your retirement accounts—or any other accounts for that matter—are in play and can be divided.

How does your spouse get their share of your 401k?

The QDRO will state how your spouse should receive their share of 401 (k) assets. They might choose to roll the funds into their own retirement account, receive a cash payment, or leave the funds in your account and receive distributions upon your retirement.

What happens to my retirement account in a divorce?

You should consult a Certified Public Accountant (CPA) or tax attorney about the best way to deal with the specific retirement accounts in your divorce. Normally, taking a distribution from your retirement account before reaching retirement age counts as an early distribution, which incurs a 10% penalty fee.

Why is my husband not entitled to my 401k?

For example, he will be all too happy to have you believe you’re not entitled to any of his 401 (k) because it is “part of his job, and you have nothing to do with it.”

How are retirement accounts divided in a divorce?

Dividing retirement accounts during divorce is also tricky because investment accounts are tied to the stock market, so changes in the stock market directly affect your account’s value. That’s why very specific language has to be used in the divorce decree.

How are 401k funds divided in a marriage?

In Equitable Distribution states, this means that the amount in the account (along with all other assets and liabilities) should be divided according to what is “fair and equitable.” In Community Property states, 401K funds accumulated during the marriage are divided in accordance with that state’s laws (usually 50-50).