Austin, TX asked in Divorce for California

Q: If a 401K has money prior to marriage and is contributed to after marriage, how is the increased value split in divorce?

This is for California.

As an extreme example, if I had $100,000 in my 401K in 1999, got married in 2000 and contributed $10,000 that year while married, if the account now has a value of $500,000, will the growth ($390,000) be evenly split or will it take into account the amount/percent that was contributed prior to marriage?

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2 Lawyer Answers
Tobie B. Waxman
Tobie B. Waxman
  • Culver City, CA
  • Licensed in California

A: The community's interest starts with contributions made during the marriage and ends on the date of separation. Growth in the 401k that can be attributed to earnings/contributions made during the marriage is community property and subject to division. A QDRO will specify the manner in which calculations should be done.

Lorna M. Jaynes
Lorna M. Jaynes pro label Lawyers, want to be a Justia Connect Pro too? Learn more ›
  • Palo Alto, CA
  • Licensed in California

A: The growth in the $10,000 contributed during marriage is community property; the growth in the $100,000 prior to marriage is separate property. A qualified domestic relations order to divide such an account would typically state that the interest acquired between the date of marriage and date of separation, plus any investment gains/losses thereon is divided equally. So the premarital interest and any gains thereon remains separate property.

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