If your spouse is provided a percentage of your pension in a QDRO, they will be responsible for paying out the taxes on it no matter the form of payment. Your ex-spouse, or soon to be ex-spouse, is certainly going to be a co-owner of all of the accounts and the cash in them. That isn’t your only problem. Your soon to be ex is going to be taking funds directly from your retirement and putting it into their own. There are limits, but each transfer can end up being what you put into it with an entire month of paychecks. All of that without ever having to worry about paying a tax bill on it. They won’t have to pay a dime until they remove the money for their own personal use. Think of how amazing that would be for you! You have to be careful and use a QDRO company for this exact purpose. If they don’t have to pay taxes, you might be stuck with it! What If You Don’;;;;;t Worry With A QDRO Company Should you make the unwise decision to ignore a QDRO company you will be taking on a whole other load of bills. Even though you won’t be making any money off of it or seeing any benefit, you will be the one stuck paying the taxes. In this case you are going to be giving money to your now ex spouse, paying the taxes on it, and not getting a dime in return. They will love you for this! When you look at it that way, you are getting the terrible end of a raw deal.