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Then and Now Pensions

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  • Then and Now Pensions

    Seeking information on how "then and now" pensions are handled.

    For those of you who don't know, then and now pensions refers to when employer pensions could not be split upon divorce/separation. Rather, the pensions remained in the spouse's name that earned them and a portion (typically 50% of the pension earned during the marriage) were *attributed* to the other spouse, but would not be paid out until such time as the spouse that earned the pension started to draw on the pension.

    So here are my questions that I'm seeking answers to:

    Does the spouse that earned the pension get to decide when they start to draw on the pension if its not stated in their divorce paperwork?

    How much does the spouse that draws on the pension actually give to the other spouse upon each payment? For instance, if the withdrawing spouse is to be paid $500 gross for a pension payment, THAT spouse is taxed on it and it may be taxed at a higher rate depending on other income. So does the receiving spouse get $250 (50% of gross) or a lesser amount because they aren't being taxed on it at all...

    I don't quite understand how this works. I'd like to know what math is typically applied and how. I'm guessing there are no tax implications for the receiving spouse since its a payment after tax to the spouse that earned it...
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