Pensions in Pay Status
Pensions already in pay status at the time of separation require additional considerations in a divorce matter. The pensions can still be divided as a marital asset however the method of valuing the total value of the pension for distribution is altered. This is because often elections for survivor benefits are made at the time the benefits commence and are usually irrevocable. Accordingly, any survivor benefit should be valued separately and set against the value of the pension itself. Pensions in pay status also present a unique issue when it comes to support.
Based on the case law established in Pennsylvania it is impermissible to use a monthly pension benefit as income available for support and also divide the pension itself as an asset in equitable distribution. This was made clear in Cerny v. Cerny, 440 Pa. Super. 550 (1995) and reiterated in Rohrer v. Rohrer ,715 A.2d 463 (1998). This same rule extends beyond just monthly pension benefits as evidenced by the fact pattern in Cerny. There, Husband had received a lump sum payment from his employer following termination. The lump sum was split as an asset and the figure received was also the basis for income available with respect to the support award. Husband was successful in appealing the decision such that the payment was only considered for support purposes and deemed a separate asset for equitable distribution purposes.