A bit of a warning to anyone who will need to do a QDRO cash-out:
The ex got paperwork saying that her temporary 401k has been created and was ready for her to do with as she pleased.
She visited the Fidelity office to get her money, and received bad advice from the Fidelity rep. She wanted to take out money to buy a house, and transfer the remainder into an IRA (and this is the order you need to do it in order to avoid the 10% penalty on the amount withdrawn - you need to take the money out before it lands in the IRA). Instead, the Fidelity rep told her - incorrectly - that her only option was to transfer the money into the IRA, and then take out the money for the house (this will force a 10% penalty on money withdrawn from the IRA!).
I caught the error within the hour, but it was too late for Fidelity to reverse the transaction. They now require her to go through a formal / written complaint process, and even then there are no guarantees that they will agree to reverse the transaction (in which case there will be a formal FINRA complaint and a lawsuit against them - including punitive damages, as this has been a major hassle). Net - lots of headache and a delay in her getting the money to buy the house she'll move into when she finally leaves (now) my house.
Ignorance runs rampant in the industry on this topic! You MUST gain the knowledge yourself - or your NJ needs to. The Fidelity rep was ignorant of the process on how to withdraw cash without incurring the penalty. Two tax accountants I talked to were also ignorant about this part of the IRS code.
The relevant IRS code is IRC 72(t)(2)(c).
LESSON: TREAT THIS PART OF THE TRANSACTION WITH KID GLOVES.