I have a client that was divorced in 2025. They had a QDRO that stated that the husband had to give her 1/2 of his IRA. She received a check and deposited it in her checking account and has done nothing else with it.

In January she received a 1099R in her name and number with box 7 marked with a normal distribution code. She is insisting that because this came thru as a QDRO order, that IRA distribution is not taxable to her.

I did research on QDRO's because I don't see them often and can find nothing that makes this tax free.

I believe it should have been set up to go into her IRA account in order for it to be not taxed as a distribution. 

Just checking to see if I missed anything. Is there some quirk in the law that I didn't find?