When a divorce occurs, a life insurance policy where an ex-spouse has been designated as a beneficiary may not be a focus of attention. States have taken steps, either through a judicial mandate or the enactment of legislation, to establish policies for dealing with beneficiary designations that have not been changed from an ex-spouse. However, when the life insurance is provided through a federal program, or is an employee benefit governed by the Employment Retirement Income Security Act of 1981 (ERISA), the Supreme Court has been clear in finding that state law is preempted, and that federal law must be applied to determine the status of the beneficiary.
Author: Paul J. Schneider, JD, LLM, is senior counsel to Paisner~Litvin, LLP, Bala Cynwyd, Pennsylvania, where he has advised clients on taxation and employee benefit matters for more than 30 years. He is a charter fellow of the American College of Employee Benefits Counsel and has served as chairman of the Important Developments Subcommittee of the American Bar Association Tax Section’s Employee Benefits Committee. Mr. Schneider is also a member of the board of editors of the Journal of Taxation.
Mr. Schneider is a graduate of Lehigh University, Columbia University School of Law (JD), New York University (LLM in Taxation), and LaSalle University (MBA). Mr. Schneider frequently writes articles and lectures on tax and employee benefits-related topics, and is coeditor of ERISA: A Comprehensive Guide, 4th Edition (Aspen, 2011).