A marital property agreement, often known as a prenuptial agreement or postnuptial agreement, is a legally binding contract between spouses or future spouses that details how assets and liabilities will be divided in the event of a divorce, separation, or death. These agreements are especially common when one or both parties entering the marriage have significant assets, children from a previous marriage, or have been previously divorced.
A marital property agreement form is a document used to create a marital property agreement. It generally outlines the basic structure of the agreement and has spaces for specific details about the couple’s assets and liabilities.
A marital property agreement form serves as a template or guide for creating a marital property agreement. While the specifics can vary from state to state or between different legal services, most forms will generally include the following sections:
- Identification of the Parties: This section typically includes space for the full names of both parties entering the agreement.
- Premarital Assets and Liabilities: Here, each party will list their individual assets (e.g., properties, investments, businesses) and debts (e.g., student loans, credit card debts) that they are bringing into the marriage.
- Description of Property Rights: This part of the agreement will outline how the property and debts acquired during the marriage will be divided in the event of divorce, separation, or death.
- Alimony or Spousal Support: If applicable, this section will include details about any alimony or spousal support that one party will provide to the other in the event of divorce or separation.
- Disclosure: This is a statement that both parties have fully disclosed their financial situation to the other party. Full disclosure is critical for the enforceability of the agreement.
- Signatures: Both parties will sign and date the agreement, often in the presence of witnesses or a notary public.
Let’s consider a hypothetical example to illustrate how it works:
Alice and Bob, before their marriage, decide to fill out a marital property agreement form. They start by providing their full names in the identification section. Then, they each list their premarital assets and liabilities: Alice notes her owned business and her student loan, and Bob lists his art studio and a car loan.
In the description of property rights, they agree that any income derived from Alice’s business and Bob’s art studio during the marriage will be considered marital property and will be divided equally in case of divorce. They also agree that a house they plan to buy after marriage will be marital property.
In the alimony section, they decide that if they divorce, the higher-earning spouse at that time will provide the other with a certain amount of financial support for a specific period.
Finally, they affirm in the disclosure section that they have honestly disclosed all their financial details to each other. They sign the document in front of a notary, who also signs and places the notary seal, making the agreement a notarized, enforceable legal document.
Marital Settlement Agreement
On the other hand, a marital settlement agreement is a related but different document that is often used when a marriage ends. It specifies how property, assets, debts, custody, visitation, and other matters will be handled after the divorce.
What Is Marital Property?
Marital property refers to all assets and debts a couple acquires during their marriage. This can include real estate, vehicles, personal possessions, investments, retirement accounts, and debts.
Marital property states, also known as community property states, are those that follow the rule that all assets and debts acquired during the marriage are considered jointly owned by both spouses, regardless of whose name is on the title.
The community property states are Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin. Alaska, South Dakota, and Tennessee also have an optional community property system.
What Is Included in a Marital Property Agreement?
A marital legal property agreement typically includes a comprehensive inventory of each spouse’s assets and liabilities, both separate and marital. It specifies which items are considered separate property (owned by one spouse) and which are marital property (owned by both). The agreement also details how marital property would be divided in the event of divorce, separation, or death.
Let’s create a scenario for a clearer understanding. Suppose Alice and Bob are about to get married. Alice is a successful business owner, while Bob is an artist. They decide to create a marital property agreement to delineate their separate and marital property.
Alice’s business, which she owned before the marriage, is listed as separate property in the agreement. Bob’s art studio, also owned prior to the marriage, is designated as his separate property. The couple agrees that any future earnings from Alice’s business and Bob’s art studio during the marriage will be considered marital property. The home they plan to buy together after marriage will also be marital property.
The agreement specifies that in the event of divorce, they will sell the marital home and split the proceeds equally. The earnings from Alice’s business and Bob’s art studio during the marriage will also be divided equally. However, Alice’s business and Bob’s art studio will remain their separate property.
Child Custody and Visitation
While a marital property agreement can clarify financial expectations during the marriage, it’s worth noting that it can’t include terms about child custody or visitation arrangements.
For example, Alice and Bob cannot include in their marital property agreement that, in the event of a divorce, Alice will have custody of their future children during weekdays, and Bob will have custody during weekends. Determining child custody and visitation rights is the purview of the court in a divorce proceeding. The court will make these decisions based on the child’s best interest, irrespective of any previous agreement between the parents.
Alimony and Spousal Support
As for alimony, while a marital property agreement can include provisions for spousal support, the enforceability of such provisions can vary depending on the jurisdiction. Some courts may review and adjust alimony terms to ensure fairness.
Let’s say Alice and Bob’s marital property agreement includes a provision that, in case of a divorce, Alice will pay Bob $2,000 per month as spousal support for two years. However, when they divorce five years later, Bob becomes a successful artist and earns significantly more than Alice.
In this case, a court may review the alimony provision in their marital property agreement. The court might find that given Bob’s current financial status, Alice’s obligation to pay him alimony is no longer fair or necessary.
The court could then adjust or even eliminate the alimony terms to reflect the current circumstances, notwithstanding what was agreed in the marital property agreement. This is because courts retain discretion over matters of spousal support to ensure fairness and to prevent undue hardship.
Do I Need a Lawyer to Draft a Marital Property Agreement?
If you are considering a marital property agreement, you can connect with a family lawyer through LegalMatch who can help guide you through the process and ensure your interests are protected.
You don’t have to wait any longer. Use LegalMatch to find the right lawyer for your marital property agreement case today.
