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Prenuptial agreements and protecting assets

On Behalf of | May 13, 2015 | Family Law

Arizona residents who are contemplating marriage may want to consider entering into a prenuptial agreement in order to protect themselves and their assets. In some cases ,they may be unable to get their fiances to agree to one. Prospective spouses should thus be aware of ways in which they might be able to protect their assets in the absence of a prenuptial agreement.

Property that people bring into the marriage is generally considered to be separately owned, and thus not divisible in a divorce. This can include such things as balances in a bank or retirement account, real estate and other assets. Inheritances received by one spouse are considered to be separate property, as are personal injury awards and gifts. If those funds are commingled with marital funds, however, they may lose their exclusion and be considered to be marital property instead.

People should keep their separate funds separate. In other words, inheritances should be deposited in a separate account, and people should not deposit such things as work checks into it. They should also refrain from adding their spouse’s name to the title of real estate that was owned before the marriage. Using marital funds for property upkeep is also not a good idea. Instead, the spouse who owns the property should pay for upkeep using separately held funds. Finally, business owners should get a valuation of their business as of the date of their marriage in order to exclude that portion of the value from division.

Property division occurs in all divorces, and people who intend to marry should take steps to protect their interests. They may benefit by seeking the assistance of an attorney in the preparation of a prenuptial agreement. As is the case with all contracts, it is imperative that both parties enter into such an agreement freely and are not induced to do so under duress, as a court may refuse to uphold it if that is not the case.