What Can and Cannot Be Included in a Prenuptial Agreement?
A divorce is something no one wants to think about at the time of getting married. Prenuptial agreements, or premarital agreements, are meant to set specific terms in place of the marriage ends. For example, a person with a successful family business may seek to protect those assets from the adversarial party in case of a divorce. But there are some limitations to what can and cannot be included in a prenuptial agreement.
What CAN be Included in Prenuptial Agreements
Items Specified as Separate and Marital Property
Alabama law determines what types of property comprise separate property and what types comprise marital property. In case of separation by death or divorce, the court will separate all of the marital property as per state laws. To avoid a court determining what happens to the assets acquired during your marriage, you can create a prenuptial agreement to delineate each party’s assets.
Protections against Debts of the Other Spouse
In the absence of a prenuptial agreement, creditors can go after the marital property even though only one party is the debtor. Limit your liability in pre-marital agreement to avoid this.
Provisions for Providing for Kids from Previous Relationships
If you have kids from an earlier relationship and want to ensure that they inherit some of your assets, you can use a prenuptial agreement.
Protections to Keep Family Property in the Family
If you have a family business, family heirloom, or even a future inheritance, or another asset that you want to keep in your birth family, you can mention this in your prenuptial agreement.
Protections for Estate Plans
Prenup agreements are only one aspect of a plan to ensure that your wishes are carried out as you desire. But remember that you must also develop and secure other documents such as living trusts and wills.
Directions for Property Distribution upon Divorce
The state of AL has laws that determine who will get what in a divorce. With a prenuptial agreement, you can avoid many of these provisions by agreeing between yourselves who gets what.
Responsibilities of Spouses: Descriptions
There are various reasons for prenuptial agreements. The following items are usually included in such agreements:
- Retirement benefits
- Separate businesses
- Income, deductions, and claims for filing your tax returns
- Management of household expenses and bills
- Management of joint bank accounts, if any
- Arrangement regarding investing in specific purchases or projects, such as a property or enterprise
- Savings contributions
- Management of credit card spending and payments
- Property distribution to the survivor, including life insurance, in the event of death
- Settlement of potential disagreements, such as using mediation or arbitration
- Arranging putting one or the other through school
What CANNOT Be Included in Prenuptial Agreements
The law in Alabama restricts what can and cannot be included in prenup agreements. Following are a list of items that AL will not allow in a premarital agreement:
Provisions on Anything Unlawful
State law prohibits you from including anything unlawful in your prenuptial agreement. Doing so can put the entire prenuptial document or parts of it at the peril of being set aside.
Decisions on Child Custody or Child Support
A prenuptial agreement cannot include child custody or child support matters. The court has the last word in determining child support. The court calculates child support on the basis of a “best interest of the child” standard, with various aspects at play.
A court would never hold valid a provision of a prenup agreement on child custody, child support, or visitation, as these are matters of public policy. The law retains the power to determine what is in the best interest of a child and will not deny a child the right to financial support or the chance to have a relationship with a responsible parent.
Provisions Encouraging Divorce
Judges will assess premarital agreements minutely to look for anything that tends to offer financial rewards for divorce. If a provision can be interpreted to encourage divorce, the court will set it aside. Courts used to see any provision on how property would be distributed as encouraging divorce, as society has an interest against divorce. For this reason, judges place such meticulous attention on these provisions.
Information about Personal, Instead of Financial Issues
A prenuptial agreement cannot include personal preferences, such as who has what chores, whose name to use, where to spend the holidays, information on child-rearing, or what relationship to have with specific relatives. Premarital agreements are meant to address monetary issues. In relation to this, provisions detailing non-financial matters will not be taken into consideration.
Judges feel ill at ease when they view private domestic issues included in a contract. They will often see the document as frivolous and strike it down. If you and your spouse seek an agreement on such things, do so in a separate document where the court will not have the power to intervene.
Learn More about What Can be Included in Prenuptial Agreements from a Dedicated Family Law Attorney
Prenuptial agreements can benefit both parties as they determine the terms of a relationship and marriage before issues arise. However, every premarital agreement should be reviewed by a lawyer before they are signed because critical mistakes in the document could cost one or both spouses later. To schedule a consultation with our family law attorneys at Smith Law Firm, call today at (334) 702-1744.
