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Divorce

If you are divorced or divorcing, your PERS benefits may be affected, and you will need to submit a copy of your divorce decree and other authorized forms to PERS’ Divorce Unit .

You also may want to change your beneficiary information if your divorce decree allows:

  • Tier One/Tier Two — For your pension, complete a new Preretirement Beneficiary Designation form.
  • Oregon Public Service Retirement Plan (OPSRP) — Your pension beneficiaries are set for you by Oregon law. Contact PERS’ Divorce Unit with questions about your beneficiaries and divorce decree.
  • Individual Account Program (IAP) — Tier One, Tier Two, and OPSRP members can use the IAP Preretirement Designation of Beneficiary form.

General information

Names

You will need to notify PERS in writing of any name change by completing an Information Change Request form.

Addresses

Both members and alternate payees must keep PERS informed of their current mailing addresses at all times. Notifications must be signed and in writing.

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Forms and guidance about how to complete them is available on our Divorce Forms webpage.

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If you have questions about a divorce or alternate payee account, you must submit your questions in writing with a signature, as required by PERS administrative rules.

When writing to PERS, include your full name, address, daytime telephone number, and Social Security number.

Submit your written questions to:

Oregon PE​RS
Attn.: Divorce Unit
PO Box 23700
Tigard, OR 97281-3700

FAX: 503-598-0561
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PERS is a public pension plan and is exempt from the federal Employee Retirement Income Security Act (ERISA) of 1974 and the Retirement Equity Act of 1984.

PERS will accept divorce decrees, property settlement agreements, and various types of domestic relations orders that have been signed by a judge and filed with the court.

A court-certified copy or confirmed copy showing the stamp of the court clerk must be received and approved by PERS before establishing a separate account or making payment to an alternate payee.

Any PERS divorce award must be detailed on the appropriate approved PERS divorce forms. The forms must be completed and referenced as exhibits on the court order.

Draft orders can be reviewed by PERS for compliance prior to submission to the court.

PERS will not make retroactive payments to an alternate payee for any period of time between the date of divorce and the date the court order is approved by PERS.

It is the responsibility of the member, the alternate payee, or their legal representatives to see that the PERS Divorce Unit receives an administrable, filed copy of the court order.

PERS does not sign court orders and will g​ive approval or nonapproval by separate letter.

Qualified Domestic Relations Orders (QDROs) or Separate Domestic Relations Orders (DROs) are not required if your divorce decree/judgment clearly provides the alternate payee award details. However, if a court order says a QDRO or DRO is to follow or to be prepared, then PERS must receive the subsequent QDRO or DRO before an award can be processed.

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PERS charges an administrative fee when we are required to set up an alternate payee (AP)/former Registered Domestic Partner (RDP) award.

The fee will be divided between the member and the AP/former RDP according to the fraction or percentage awarded by a court order.

The one-time fee will be deducted from the first regular benefits payment each party receives. A separate administrative fee will be applied to each account from which funds are awarded.

ORS 238.465 (9) defines the maximum limit for the one-time fee. In 2023, lawmakers passed House Bill (HB) 2284, which increased the limit starting in 2024.

Under HB 2284, the maximum fee limit is subject to change by the PERS Board each year, starting January 1. The board will adjust the limit based the previous year’s cost of living. PERS uses the Consumer Price Index (All Urban Consumers, West Region) to determine cost of living.

PERS will notify members and APs/former RDPs of their assessed fee when we notify them that their court order has been deemed administrable. A court order has been deemed administrable by PERS once staff has fully reviewed the order; PERS has received all required documentation; and the agency has notified the parties involved that it's administrable. The parties notified can include the member, alternate payee, and their attorneys.

The administrative fee is assessed based on when the court order is determined to be administrable.

Divorce administrative fees and limits

Year Amount How it is applied
Beginning May 1, 2024 $1,300 maximum limit Fees vary depending on the estimated costs of implementing the court order.
2023 or earlier $300 fee All awards deemed administrable prior to May 1, 2024, will pay this fee.

How administrative expenses determine the fee

If a court order is deemed administrable May 1, 2024, or after, PERS will base the fee on one of the following administrative cost levels:

  • Low administrative cost — 50% x maximum fee limit
  • Moderate administrative cost — 75% x maximum fee limit
  • High administrative cost — 100% x maximum fee limit

Remember: A member and an alternate payee/former Registered Domestic Partner will split the overall fee, based on the award in their court order.

Examples of awards and the fees that apply

Member/account type Member’s retirement status Award type Low administrative cost fee Moderate administrative cost fee High administrative cost fee
  • Tier One
  • Tier Two
OR
  • Oregon Public Service Retirement Plan (OPSRP)
Retired Reduction or Deduction Award — without the option to change survivor beneficiary
Individual Account Program (IAP) Either retired or not retired Separate Account
  • Tier One
  • Tier Two
OR
  • Oregon Public Service Retirement Plan (OPSRP)
Not retired Deduction
  • Tier One
  • Tier Two
OR
  • Oregon Public Service Retirement Plan (OPSRP)
Retired Reduction or Deduction award — with the option to change survivor beneficiary
  • Tier One
  • Tier Two
Not retired​​
 Separate Account
  • Tier One
  • Tier Two
OR
  • Oregon Public Service Retirement Plan (OPSRP)
Not retired Reduction or Separate Benefit
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Prior to divorcing, members and their legal representatives normally obtain information about PERS members’ current and future retirement benefits.

Information about what assets are available for division is used during divorce proceedings to determine the alternate payee award.

Although the court may determine another method for dividing a PERS account, the court often makes an alternate payee award based on how much of a member’s account was accrued during the marriage.

Predivorce estimates for divorce-planning purposes can be obtained using the Benefit Estimate Calculator in Online Member Services.

If a separate account has been established for an alternate payee, the estimate calculator can no longer be used, as it is not programmed to adjust for divorce.

Once a divorce has been finalized, all requests for benefit estimates and other member information must be submitted in writing, and a signed release from the member must be received by PERS.

An exception is made only if PERS receives a subpoena. Subpoenas should be made out to: Oregon Public Employees Retirement System. The most appropriate staff member will respond.

Subpoenas will not be accepted by fax, and PERS requires at least three full business days to respond. PERS would prefer to provide written information in response to a subpoena as we have limited staff available to testify in a court setting. PERS also can provide testimony over the telephone.

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PERS does not provide an actuarial valuation of retirement benefits (present value study). A private actuary will be able to provide this information.

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PERS will not provide payroll or personnel records. The member’s employer must be contacted for this information.

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A member’s benefits cannot be garnished for past-due consumer credit bills or attorney fees under Oregon Revised Statue (ORS) 238.465.

A member’s account can be garnished ​only for current and past-due child or spousal support pursuant to ORS 238.445.

PERS statute (ORS 238.465) and Oregon Administrative Rule (OAR) 459-045 apply to divorce and garnishments and are available upon request.

Garnishment questions and separate court orders for the Oregon Savings Growth Plan or other public retirement plans should be sent to those entities directly.

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Oregon law and PERS rules: What they mean for divorce awards

PERS can pay Tier One, Tier Two, OPSRP, or IAP benefits to an alternate payee accordin​g to Oregon Revised Statute (ORS) 238.465.

This statute allows PERS to pay to an alternate payee any pension, annuity, retirement allowance, disability retirement benefit, death benefit, or refund benefit* that is due a member if and to the extent expressly provided for in the terms of any court ord​er or court-approved property settlement agreement resulting from any court order or decree of annulment, dissolution of marriage or registered domestic partnership, or separation.

Under ORS 238.465, PERS can either**:

  • Transfer an award made to an alternate payee by the court (at the time of divorce or at retirement) into a separate account in the name of the alternate payee.
    OR
  • Divide benefits when they become due or payable to the member or on behalf of the member.

*“Refund benefit” refers to situations in which PERS cashes out small retirement benefits (less than $200 a month, as of 2023). The member or alternate payee is paid an actuarially adjusted benefit in one payment instead of monthly payments. The Oregon Legislature determined that the size of some monthly payments to be so small as to be cost-prohibitive to the agency to administer on a monthly basis. Refund benefits differ from withdrawals in that membership rights are not terminated when an account is paid out as a refund benefit.​

**There may be advantages and disadvantages to transferring an award or dividing benefits.

Additional direction is provided in Oregon Administrative Rules (OAR) Chapter 459-045.

Before payments can be paid to an alternate payee, PERS must receive administrable copies of court documents, signed by a judge, with proof that the decree and required forms have been filed in court. PERS determines whether a court order is administrable for PERS purposes.

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Oregon Revised Statute 238.465 requires PERS to create rules about how to establish a separate account in the name of the alternate payee. The rules were updated in May 2010. Different rules exist for Tier One/Tier Two, OPSRP, a​nd IAP.

Divorce forms detail the types of awards that are acceptable under each plan and designed to guide you through the award process. Use the forms to specify your divorce award, and submit the forms with your court order as referenced exhibits.

A separate account can be established at the time of divorce if specified in the court order. The court order and divorce forms must state that the award will be placed in a separate account in the alternate payee’s name.

The court order or forms must specify a percentage or dollar amount (not a combination) either directly or based on a clear formula resulting in a percentage or dollar amount, to be awarded to the alternate payee.

The court order or forms also must provide the date of transfer (division date). If the order or forms do not specify a transfer date, PERS will use the date the order was signed by the court.

Awards are applied against the last-audited PERS member account balance on record (December 31) of the plan year preceding the award date.

Additional information

The amendments to ORS 238.465 that allow a separate account to be established in the name of the alternate payee are retroactive to court orders received prior to implementation (1993) if:

  • The decree allows for the provisions or is silent.
  • Applying the changes is not inconsistent with the decree language.
    AND
  • Neither the member nor the alternate payee are receiving payments.

The court order on file with PERS will determine what benefits are available to the alternate payee. If the present court order conflicts with the amended provisions of ORS 238.465, the parties will need to pursue an amended or modified decree if either party wishes to have the amended statutory provisions apply.

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Decrees may allow for the alternate payee’s award to be based on a percentage or specified dollar amount from the member’s actual benefit payments.

Under this method, the alternate payee receives payment at the same time the member receives refund*, death, service retirement, or disability retirement benefits, as provided for in the court order.

A separate account will not be established in the name of the alternate payee.

Also, if an award to an alternate payee reverts to the member upon the alternate payee’s death or at some other time, no separate account will be established. Benefits will be determined using the highest-paying calculation method.

A court can choose one of two methods to make the award:

  • Set monthly dollar amount or set monthly percentage award — A set dollar amount or set percentage of any benefit due is awarded to an alternate payee. The award is deducted from the member’s monthly benefit at the time the member retires or goes into pay status and is paid to the alternate payee at the same time and in the same manner as it is to the member.
  • Ratio method — Under this method, an a​ward is calculated by dividing a couple’s married service time by the member’s total creditable service time when benefits are due to determine the percentage of the retirement benefit that accrued during the marriage. The resulting fraction is multiplied by the percentage awarded by the court to the alternate payee. The resulting percentage is then applied against the member’s retirement benefit. This amount is paid to the alternate payee monthly or in a lump sum, based on decree provisions.
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*A “refund benefit” refers to situations in which PERS cashes out small retirement benefits (less than $200 a month, as of 2023). The member or alternate payee is paid an actuarially adjusted benefit in one payment instead of monthly payments. The Oregon Legislature determined that the size of some monthly payments to be so small as to be cost-prohibitive to the agency to administer on a monthly basis. Refund benefits differ from withdrawals in that membership rights are not terminated when an account is paid out as a refund benefit.

The IAP is an account comprised of member contributions and earnings. A percentage or flat dollar amount of this account can be awarded to an alternate payee.

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PERS administers OSGP, which is independent of pension benefits. Any divorce awards involving OSGP must be mailed directly to:

Oregon Savings Growth Plan
State Archives Building
800 Summer St., Suite 200
Salem, OR 97310-1348
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The following information is for Tier One/Tier Two members only.

Employer funds (pension money)

The employer account (from which pension benefits are paid) is a part of the member’s PERS ​entitlement* but is separate from the member’s PERS account. Therefore, if employer funds are to be awarded to an alternate payee, it must be specifically stated in the court order or forms.

Also note that employer funds will not be paid until they become due or payable to the member. If the award does not includ​e employer funds, that also must be stated in the court order or forms. If a person refunds their PERS account or the member account is in loss of membership, no employer funds will be paid.

*An entitlement differs from a benefit. Where employer accounts are concerned, employers pay a rate to PERS based on payroll. While the money employers pay is used to fund pensions, it is not earmarked to individual members. So while your employer may pay PERS money and it will help fund your retirement benefits, it is not specifically yours.​

Time of establishment of separ​ate account before retirement

An account established in the alternate payee’s name will earn interest until benefits are paid. The alternate payee can elect to begin receiving benefits when the member reaches earliest retirement age regardless of when the member actually retires. However, the alternate payee cannot elect a retirement date earlier than the first day of the month following the month in which he or she files an application with PERS (must be on or after the effective date of the court order). An alternate payee with a separate account cannot participate in the variable annuity program.

Time of establishment of separate account at retirement

Decrees may allow for the alternate payee’s award to be based upon a percentage or specified dollar amount (under a ratio method) based on a member’s actual retirement. Under this method, the alternate payee receives payment at the same time the member retires under service retirement or disability retirement, as provided for in the court order or forms. A separate account will not be established in the name of the alternate payee until payout to the member occurs.

Under this award, the court order or forms must include earliest eligibility language and that the alternate payee may have a separate account at retirement eligibility or at the time the benefits become due and payable to the member.

Alternate payee benefit options

Alternate payees with separate accounts will be able to select one of five benefit payout options independently of the member’s choice. The law does not allow joint and survivor annuity options for alternate payees. Benefits will be annuitized based on the age of the alternate payee to determine payment amounts and to establish reserves. An alternate payee’s separate account benefit will be determined using the Money Match calculation method. Alternate payees are not allowed to cancel benefits after the first check is processed.

The five alternate payee options available are:

  • Option One — This is a straight life benefit. Monthly benefits are paid for the alternate payee’s lifetime. No benefit of any kind is payable to anyone after the death of the alternate payee.
  • Refund Annuity — This benefit is paid for the alternate payee’s lifetime. The existing account balance of the alternate payee at the time the alternate payee begins receiving benefits will be reduced each month by the amount of the “annuity” portion of the alternate payee’s monthly benefit. Upon the death of the alternate payee, the alternate payee’s designated beneficiary will receive a lump-sum payment of any remaining account balance. Under this option, the alternate payee’s beneficiary may be changed at any time. Usually, after nine to twelve years, no remaining account balance is available to pay to a beneficiary.
  • 15-year Certain — This benefit is payable for the alternate payee’s lifetime. If the alternate payee dies before receiving 180 payments, the remainder of the 180 payments will be paid monthly to the alternate payee’s beneficiary. Once 180 payments have been made, all beneficiary benefits will stop. Under this option, the alternate payee’s beneficiary designation may be changed at any time.
  • Lump-sum Option One — Under this option, the alternate payee’s account balance can be paid in a lump sum in one payment or in up to five annual installments. The alternate payee also may receive a monthly pension check for employer funds if employer funds were awarded in the court order. A lump-sum payment may be rolled over to another qualified plan or an individual retirement account or annuity.
  • Total Lump Sum — A one-time payment of member dollars is awarded to the alternate payee, plus a matching amount from the employer. There is no monthly benefit under this option and no cost-of-living increases.
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The following information is for OPSRP members only.

Because OPSRP retirement benefits are strictly employer-dollar-based, only awards of members’ benefit payments can be made. The same rules apply as for PERS Tier One or Tier Two divided benefits.

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The following information is for PERS judge members only.

Oregon Revised Statute 238.505-238.585 governs PERS judge members.

Retirement calculations for judges are different than calculations for other PERS members.

Contact the Divorce Unit in cases involving PERS judge members.

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Retirement and divorce

A member can select one of 13 retirement benefit options. The court may allow the member to select any option upon retirement or restrict the member to a specific option.

Refer to the preretirement guide for your membership type (Tier One/Tier Two or OPSRP) for an explanation of the benefit options that are available and a description of how they work.

Regardless of whether the member is free to select any option or is restricted to a particular option, the alternate payee will receive a percent of the member’s benefit for as long as it is paid out.

If a member chooses a lump-sum option, the alternate payee also will receive a lump sum. If the member selects a monthly option, the alternate payee also will receive a monthly benefit payment.

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The designation of primary beneficiary for joint and survivor annuity options is made at the time the member applies for retirement.

The court may require the alternate payee to be named as the primary beneficiary, so the alternate payee will continue to receive his or her share for life. Any remaining share can go to the member’s secondary beneficiary, such as a current spouse, but this payment will stop upon the death of the alternate payee.

When a member is free to name anyone as primary beneficiary and does not name the alternate payee, all payments to the alternate payee cease on the primary beneficiary’s death.

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Increases to benefits — such as cost-of-living adjustments (COLA), ad hoc increases, and tax remedy increases — are not due the alternate payee until they are due and payable to the member.

If an increase never becomes due and payable to the ex-spouse member, then the alternate payee will never receive an increase.

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Divorce’s impact on death benefits

If a member withdraws their account balance, the alternate payee award is applied against the amount to be withdrawn.

The alternate payee can leave their award in PERS and have a separate account created at this time​​ if the court order specifically allows this provision.

If the member terminates PERS-covered employment or is an inactive member at the time of divorce, an alternate payee with a separate account can withdraw the account balance regardless of what the member does. The member has to be separated for a full calendar month after termination for PERS to issue a withdrawal to the alternate payee.

Alternate payees of active, contributing PERS members will not be able to withdraw or take a refund of their account balance.

A withdrawal cancels a​ll rights to employer funds even if they were awarded to the alternate payee in the court order.

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Tier One and Tier Two

If the member dies after the divorce is final but prior to retirement, the alternate payee’s share will be paid as stated in the court order.

If a member is eligible for a matching employer death benefit, the alternate payee also could receive a portion of this benefit if provided for in the court order.

The benefit share of an alternate payee who dies after the divorce is final but before the member retires may continue to be paid to the alternate payee’s estate or beneficiary if the alternate payee was awarded a separate account.

If an alternate payee dies before receiving benefits on an account in their name, their beneficiary will be eligible for employer-matching death benefits on the account established in the alternate payee’s name if the member was eligible to receive those benefits had the member died on the same day as the alternate payee. This point does not need to be negotiated or contained in the divorce decree. It is automatically provided by law in Oregon Revised Statute 238.465 (4).​

OPSRP

A preretirement death benefit is only available on an OPSRP account if the member is currently married.

A court order or divorce forms can award all or a portion of the preretirement death benefit to the alternate payee or surviving children, but this designation will be voided if the member is not married at the time of death.

Individual Account Program (IAP)

Divorce forms or a court order can require a member to name their alternate payee or surviving children as beneficiaries on an unretired IAP.

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Post-retirement death benefits will be paid in accordance with the benefit payout option selected by the member, the designation of the primary beneficiary, if any, and the terms contained in the court order regarding what is to happen upon the death of the member or the alternate payee.

The beneficiary of an alternate payee who was receiving benefits under a separate account will be eligible for death benefits based on the option selected by the alternate payee.

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Divorce and taxes

Members and alternate payees are responsible for their own taxes on individual awards received in a property settlement.

For tax-reporting purposes, members and alternate payees will receive separate 1099-R tax forms at the end of each year in which benefits are paid.

PERS recommends members and alternate payees refer all tax questions to the Internal Revenue Service, the Oregon Department of Revenue, or a qualified tax consultant.

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Prior to July 1, 1979, all members paid their own contributions from their monthly income. This after-tax contribution is referred to as member cost and is reported as employee contributions on 1099-R tax forms.

Member cost is allocated between the member and alternate payee based on the proportion of the entire benefit awarded to each.

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Disclaimer

The content on this webpage is not a legal reference and is not a complete statement of the laws or PERS administrative rules. In any conflict between the content on this page and Oregon laws or administrative rules, the laws and administrative rules shall prevail.

Troubleshooting

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Contact PERS’ Divorce Unit

Submit your written, signed questions to:

Oregon PERS
Attn.: Divorce Unit
PO Box 23700
Tigard, OR 97281-3700

FAX: 503-598-0561

For additional information to include when writing, read the “Questions about divorce accounts” section on this webpage.

Glossary

Alternate payee — An alternate payee is a spouse, former spouse, or registered partner who has a right to receive all or a portion of the retirement benefits of a PERS member. In the case of a divorce, this could be a former spouse who is awarded a portion of retirement benefits in a divorce decree.