Prenuptial Agreements

A prenuptial agreement, antenuptial agreement, or premarital agreement, (commonly abbreviated to prenup) is a contract entered into prior to marriage, civil union or any other agreement prior to the main agreement of partners intending to marry. The content of a prenuptial agreement varies, but commonly includes provisions for division of property and spousal support in the event of divorce.

The range of what can be in a prenuptial agreement is flexible and can accommodate most of the individual wants and desires that a marrying couple has. On the other hand, there are some strict rules about what cannot be in a prenuptial agreement.

Many people incorrectly believe that only wealthy people avail themselves of prenuptial agreements, for example, in the case of May-December, trophy wife marriages, where a business powerhouse with children from previous marriage(s) marries a much younger – and less wealthy – woman. Prenuptial agreements insure that the inheritances of adult children from earlier marriage(s) are protected, particularly when these May-December marriages capsize, as is so often the case.

Generally, a prenuptial agreement can deal with the division of property in a divorce, the identification of community property versus separate property, ownership of the marital residence, responsibility for premarital debts, distribution of property on death (this may require an update of estate planning documents to reflect his), alimony obligations (in some jurisdictions), and financial responsibilities during the marriage.

A prenup also identifies the jurisdiction controlling the prenup, which otherwise is the state of the divorce, and not the marriage, the resolution of disputes about the prenup (for example, through mediation or arbitration), and can provide for a sunset clause, which allows for their prenuptial agreement to become invalid if they are married for a certain number of years.

Judges have latitude in the enforcement of a prenuptial agreement when it is deemed illegal or “unconscionable” (unfair), or thought to encourage divorce. For example, although most states permit prenuptial agreements to deal with alimony, a court may invalidate the alimony provisions if the judge believes them to be unjust. This happens in long-term marriages if there is a great disparity between spouses’ incomes and there would be no or little alimony being paid according to the prenup.

Including items that deal with particular aspects of married life, such as the division of household responsibilities, may also increase the likelihood of a prenuptial agreement being invalidated.

Prenuptial agreements identify and distinguish between separate and marital property. Each jurisdiction has its own separate laws that govern separate property and marital property (often called “community property”). Without a prenuptial agreement upon separation by death or divorce, the court separates all of the marital property evenly. A prenup can be used in order to avoid a court deciding marital property attained during the marriage.

The prenuptial agreement protects one spouse from the other’s debts. Without a prenup, creditors can go after the marital property even though only one spouse is the debtor. To avoid this, spouses limit debt liability in a prenuptial agreement.

The prenuptial agreement protects children from previous relationships, and keeps family property in the family. A family heirloom, family business, even a future inheritance, or other piece of property can be kept within a birth family in a well-crafted prenup.

A prenuptial agreement is also part of ensuring that an estate plan is carried out as written, but it requires wills and living trusts. A prenup bypasses state law governing divorces because the spouses agree about who gets what.

On the other hand, some things cannot be included in a prenuptial agreement. State laws restrict what can and cannot be included in prenuptial agreements.

Every jurisdiction prohibits including anything illegal in a prenuptial agreement. In fact, doing so can put the whole prenuptial document or parts of it at risk of being set aside.

  • A prenup cannot include child support or child custody issues. The court has the final say in calculating child support. The court determines child support based on a “best interest of the child” standard, with several factors at play. No court would uphold a provision of a prenuptial agreement that dealt with child support, child custody, or visitation, because these are issues of public policy. The court retains the power to decide what is in the child’s best interest. It will not deny a child the right to financial support or the opportunity to have a relationship with a fit parent.
  • Waiving alimony is the provision most commonly struck down by courts. A few states strictly prohibit this. Other states look down on it and limit the waiving of alimony rights. Some states do allow alimony waivers.
  • Judges scrutinize prenuptial agreements for anything that offers a financial incentive for divorce. If a provision can be read to encourage divorce, the court overturns it. Courts used to view any provision detailing how property would be divided as encouraging divorce, because society has an interest against divorce.
  • Provisions that detail personal choices instead of financial matters (“We will spend all our holiday time with my parents”) may get thrown out. Courts often do not want to relegate domestic matters to a contract. These include who has what chores, whose name to use, details about child rearing, or what relationship to have with certain relatives. Prenuptial agreements are designed to address financially based issues. Judges grow uncomfortable when they see private domestic matters included in a contract; they will often view the document as frivolous, striking it down.

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