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TSPs in divorce

On Behalf of | Aug 18, 2017 | High Asset Divorce

Federal employees living in Maryland may have some special concerns during divorce proceedings. Many federal employees have what is known as a Thrift Savings Plan, which can be counted by the courts as a marital asset. If it is considered a marital asset, one’s spouse may be entitled to a portion of the funds as part of the divorce settlement.

The division of a TSP is not governed by any federal regulations or laws. Instead, it is up to the couple to come to an agreement on how the TSP should be divided, or if it should be divided at all. If the couple can’t work out a settlement on their own, they may need to resort to mediation or asking a judge to make the decision for them.

What is important, however, is that the agreed-upon division must be outlined in a Retirement Benefits Court Order, which may be included in a divorce decree, property division or Qualified Domestic Relations Order. The federal employee should ensure that his or her documents meet the requirements of an RBCO, which can be found on the TSP website as a free booklet called “Court Orders and Powers of Attorney.”

Individuals with TSP accounts may benefit from speaking with a family law attorney who has experience in working with TSPs. An attorney with this kind of knowledge could help make sure that requests and orders are formatted properly. In addition, the attorney may also be able to advise on other areas, including child custody and spousal support.

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