Maybe I can help, CDFA by trade. It is not stated explicitly. That is what causes a lot of confusion. IRS is silent on the topic. However, I can tell you how things typically work.
When you take a QDRO distribution, most plan providers will require that you distribute (rollover) the remaining balance to another plan (IRA). They want the plan cleaned out of their system. Thus you are typically limited to one QDRO distribution.
I suppose if you found a plan provider that allowed you to keep the money in the plan, you theoretically could do multiple distributions that would be exempt from the 10% penalty. But I have not seen a plan that is willing to do this. Know that I have also discussed this extensively with a local QDRO attorney that does extensive work with preparing QDROs for Fortune 500 companies that use Fidelity. And I will add, that just because you might be able to do something, it doesn't mean that you should. That same QDRO attorney recommends that if you plan on taking a QDRO distribution that you do it within the first year of the QDRO being funded, even though there is no real guidance on the subject. But as stated above, when it doubt, talk to the attorney.
Kyle Eaton, CDFA
www.counterbalancedivorce.com
