Florida Court Addresses Retirement Benefits During Divorce
One issue that is often misunderstood is whether or not retirement benefits are divisible in a divorce. In other words, is your spouse entitled to your retirement benefits? The answer is yes, retirement benefits are part of the marital estate, and as such, they can be awarded to the other spouse in accordance with equitable distribution. In this article, the Tampa, FL, Divorce Lawyers at Westchase Law, P.A. will discuss a real Florida family law case dealing with the division of retirement benefits.
Background of the case
In the aforementioned case, the spouses were undergoing a divorce where the husband had obtained retirement benefits from his employment during the marriage. The retirement benefits were not fully earned and depended on several forthcoming events, including employment and retirement.
In the course of the divorce case, there was a debate as to whether the retirement benefits should be regarded as part of the property belonging to the spouses. The trial court did not recognize the pension as an asset to be distributed since the benefits were speculative and uncertain.
However, the wife appealed against the ruling of the trial court, arguing that the benefits were earned within the marriage period and therefore should be distributed equitably.
The appeal
During the appeal proceedings before the Florida Supreme Court, the central issue was whether the retirement benefits earned within the marriage period were considered marital assets despite being unearned and unpaid.
The Court dismissed the notion that such benefits remain too speculative for division and found that retirement benefits accumulated during the marriage constitute deferred compensation and thus are marital property available for equitable distribution.
The Court noted that excluding such benefits would be unjust to the non-working spouse, especially in cases of long marriages, where one spouse has helped another advance in their career. Treating retirement benefits as marital property sends a strong message that spouses jointly benefit from the marriage’s economic gains.
Notably, the Court acknowledged that the valuation and division of retirement benefits might call for flexibility. For instance, trial courts can use different approaches to guarantee fair distribution, including present value calculation and deferred distribution, whereby benefits are divided when received.
Finally, the Florida Supreme Court overturned the trial court’s judgment and remanded the case back to the trial court with an order to include the retirement benefits in the marital estate.
Key takeaways
This case is fundamental when it comes to understanding how divorcing spouses should handle retirement benefits in Florida:
- Marital asset – Benefits accrued during the marriage period fall under equitable distribution.
- Deferred compensation – Although the spouse does not receive these benefits right away, they are valuable and need to be counted.
- Equitable treatment – The non-working spouse or the one who earns less is also entitled to receive shares from the marital assets.
- Multiple approaches – Dividing retirement benefits could take different forms based on specific situations.
Ultimately, retirement benefits are a part of the marital estate and can be divided between the spouses in accordance with equitable distribution.
Talk to a Tampa, FL, Family Law Attorney Today
Westchase Law, P.A., represents the interests of Tampa residents who are going through divorce. Call our Tampa family lawyers today to schedule an appointment, and we can begin addressing your concerns right away.
Source:
law.justia.com/cases/florida/supreme-court/1986/66221-0.html
