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Court of Appeals decided that based on the legislative history of
the statute, the Court’s reading of section 414(p) was too narrow
and would make it unreasonably difficult for DROs to qualify as
QDROs. Id. at 991. Dr. Amarasinghe argues that the Court of
Appeals’ interpretation of section 414(p)(1)(A)(i) supports his
argument that the Order is a QDRO because, like the DRO in
Hawkins, the Order specifies the Plan as the source of the funds
that Dr. Amarasinghe must pay to Ms. Amarasinghe.
Ms. Amarasinghe and respondent argue, and we agree, that the
case before us is distinguishable from Hawkins v. Commissioner,
supra, because in the case before us the Order did not give Ms.
Amarasinghe a direct right to receive the distribution, but
instead required Dr. Amarasinghe to “cash out” first. In
Hawkins, the DRO at issue allowed the former spouse to receive
payments directly from the plan. Hawkins v. Commissioner, 102
T.C. at 63.
A DRO fails to meet the requirements of section
414(p)(1)(A)(i) if it does not create or recognize in the
alternate payee the right to receive benefits directly from a
qualifying plan. Dr. Amarasinghe argues that the Order is a QDRO
because the “end result” it required was that Ms. Amarasinghe
receive funds originating from the Plan. However, this argument
urges us to ignore the statutory requirement that to be
qualified, a DRO must create or recognize in an alternate payee
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Last modified: March 27, 2008