FireSprite

I may be wrong, but I work in the financial industry & my understanding is that you CAN'T roll a 401K to a 401K because those plans are actually separate entities set up by the sponsoring employer & not the same type of retirement structure as say, an IRA account.

You SHOULD be rolling from his 401K to a Traditional IRA account in your name. (I've done a few of these for a divorce settlement) And once the funds are received you will likely have to have them reinvested... many times the funds offered in the existing 401K can't just be transferred in-kind & must be liquidated & then the cash proceeds are distributed. If they INSIST that it has to remain under his 401K plan but in your name, you'll have greater restrictions on investment choices, future distributions, etc. In an IRA you are in the driver's seat & have much more control over it all around. The rules are very different for these plans so it may really benefit you to discuss all of this with a financial planner. You would want someone who is more than just a broker - preferably A CFP (Certified Financial Planner) who has some experience with all sides of this - 401K plans, divorce settlements, tax law.

The 28% makes no sense to me either, except in the case where it represents his investments made during a time outside of your marriage (before or after). Even if it relates to your joint tax bracket, it should not factor into the distribution because once divorced you file your tax returns as inividuals & your individual tax rates may be different. (even likely) Why would they essentially be holding a % to pay HIS taxes (in the future mind you, he'd owe nothing due to the divorce distribution) but not yours?