Can AI answer QDRO questions?
Artificial Intelligence (“AI”) is great for generating images of cats having tea parties on the surface of mars, but the legal profession is somewhat skeptical of AI’s ability to answer legal questions.
To test this in the area of QDROs, we asked a somewhat simple but technical question: is TSP ERISA qualified?
TSP or Thrift Savings Plan is a very common plan as it is available to many Federal employees. It is a defined contribution plan, similar in many ways to a traditional 401k. 401k plans are qualified under Employee Retirement Income Security Act (ERISA), a Federal statute. So, the question asks whether TSP, being similar to a 401k plan, is also backed by ERISA.
An ERISA qualified retirement plan is a plan which must comply with all regulatory requirements that ERISA requires. These regulations are designed, among other things, to protect the individual. In this way, a plan that is ERISA qualified is safer.
Further, an ERISA qualified plan can be divided at divorce using a Qualified Domestic Relations Order (“QDRO.”) So, if you’re looking to have an ERISA qualified plan divided, you know that you must have a QDRO prepared.
But, what about plans which are NOT backed by ERISA? Some of these can be divided using entirely separate statutory schemes apart from ERISA, such as a state statutes. Others do not require domestic relations orders at all, such as some IRAs (but not all.)
When we asked AI “is TSP ERISA qualified?” we got this answer:
Is this correct? Simply put: no. If nothing else, TSP is codified at Chapter 84 of title 5, United States Code, where as ERISA is codified at Chapter 18 of title 29. In fact, TSP itself provides this guidance:
One might speculate that AI made this mistake because TSP is so similar to a 401k. After all, TSP was designed to be 401k-like option for Federal employees because Federal employees have less access to the benefits of a defined contribution plan. Nevertheless, they are not identical, and TSP is not ERISA qualified.
If you have a technical question about QDROs, AI might not be your best resource. Instead, call Weinberg & Schwartz.
