A qualified domestic relations order (QDRO) (pronounced quad-row or cue-dro) is a judgment, decree, or order for a retirement plan to pay child support, alimony or marital property rights to a spouse, former spouse, child, or other dependent of a participant. The QDRO is often included in a divorce decree or marriage settlement agreement (MSA) and must contain certain specific information, such as:

• the participant and each alternate payee’s name and last known mailing address, and

• the amount or percentage of the participant's benefits to be paid to each alternate payee.

A QDRO may not award an amount or form of benefit that is not available under the plan.

A spouse or former spouse who receives QDRO benefits from a retirement plan reports the payments received as if he or she were a plan participant. The spouse or former spouse is allocated a share of the participant's cost (investment in the contract) equal to the cost times a fraction. The numerator of the fraction is the present value of the benefits payable to the spouse or former spouse. The denominator is the present value of all benefits payable to the participant.

A QDRO distribution that is paid to a child or other dependent is taxed to the plan participant.
An individual may be able to roll over tax-free all or part of a distribution from a qualified retirement plan that he or she received under a QDRO. If a person receiving QDRO payments is either the employee's spouse or former spouse (not as a nonspousal beneficiary), then he or she can roll it over, just as if he or she were the employee receiving a plan distribution and choosing to roll it over.

In Oregon, a Qualified Domestic Relations Order (QDRO) is a legal order that is part of a divorce decree or marriage settlement agreement, which allows for the division of retirement plan benefits. The QDRO must specify the names and addresses of the retirement plan participant and the alternate payee(s), as well as the amount or percentage of the participant's benefits to be paid to each alternate payee. It is important to note that a QDRO cannot grant benefits that exceed what the retirement plan allows. When a spouse or former spouse receives benefits under a QDRO, they report the income as if they were the plan participant, and the tax implications are based on the allocation of the participant's investment in the contract. Distributions to a child or other dependent under a QDRO are taxed to the plan participant. Furthermore, the recipient of a QDRO distribution, if they are the spouse or former spouse of the employee, may be eligible to roll over the distribution into another qualified retirement plan or an individual retirement account (IRA) tax-free, under the same conditions as the employee would be able to do so.