In re Marriage of Mueller

Shelley and Christopher married in 1992. Shelley works in the private sector and has Social Security tax withheld from her pay; she expects to receive full benefits in 2033 at age 67. Christopher works for the police department and does not have Social Security tax withheld. He contributes to the Police Pension Fund and can retire with full benefits in 2017 at age 50. In their 2012 divorce, Christopher computed the estimated present value of his pension benefits, using a “Windfall Elimination Provision” to determine what part of those benefits were in lieu of Social Security, which is exempt from equitable distribution. Using Christopher’s wages, as if covered by Social Security, predicted that his Social Security benefit at age 67 would be $1,778 per month; using his wages for those years in which he contributed to Social Security, predicted that his benefit at age 67 would be $230 per month. The difference of $1,548 was posited as “in lieu of Social Security.” The difference between that amount and the pension amount was $2,479 per month, with an estimated present value of $639,720.74. The court determined that the proposed valuation would violate federal law as interpreted by Illinois Supreme Court precedent. Christopher recalculated the present value of his pension, without the offset, as $991,830. The court adopted that figure, and awarded Shelley about 35%. The Illinois Supreme Court affirmed, reasoning that Social Security benefits cannot be calculated until the participant collects them. Decreasing Shelley’s share of Christopher’s pension based on the present value of hypothetical Social Security benefits that, even if he had participated in that program, he might never receive is illogical and inequitable. Failing to consider Social Security may paint an unrealistic picture of their future finances, but Congress intended to keep those benefits out of divorce cases. View "In re Marriage of Mueller" on Justia Law