Prenuptial Agreement & Alimony
Divorce can be a complicated process. There's the debt and property you had before getting married and the debt and property you collect while you were married. Different states have different laws about how everything is divided once you decide to part ways. A prenuptial agreement and alimony are two common issues affecting who gets what in a divorce.
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What's a Prenuptial Agreement?
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A prenuptial agreement is a legal contract agreement between two people before they get married. The agreement includes each party's assets and debt listed separately. It also clarifies what each person will receive if the marriage ends in divorce.
Anyone can use a prenuptial agreement. Some people assume they are just for the wealthy to protect their interests. Some people draft prenups to make sure that property is properly distributed in the event of an untimely death. If there is no prenuptial agreement, a parent may take a larger share of the deceased spouse's property which leaves less for the children.
Prenuptual Agreement Clarifies Financial Rights and Responsibilities
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If you marry without a prenuptial agreement, the state decides how property will be divided in the event of death or a divorce. Any property that you gain together while married is considered community property. States have differing laws about what happens to property acquired before marriage. Property one spouse had before marriage could ended up split in half and distributed during divorce. Depending on the laws in your state, you also could find yourself responsible for your spouse's debt. This is why a prenup can be so important.
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What is Alimony?
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Alimony is commonly referred to as spousal support. It is meant as a way of providing the lower income spouse with financial support to help cover living expenses. It is separate from child support. Alimony is granted at the discretion of the judge.
Types of Alimony
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When a judge awards alimony to a spouse, it is awarded in one or more of the following combinations: permanent alimony is paid to the receiving spouse until he dies or remarries. Some courts may include a condition that the alimony stops if the receiving spouse is living with someone else, avoiding marriage.
A lump sum alimony is received as a one-time payment instead of weekly or monthly payments. When alimony is received this way it is considered taxable income so you may also need to consult with an accountant experienced in divorce.
Temporary alimony lasts for a specified amount of time, typically between one and two years. This type of alimony is usually awarded to give the receiving spouse a chance to get back on her feet so that she can support herself.
A Prenuptial Agreement Can Affect Alimony
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In some cases a prenuptial agreement is used to set limits on the amount of alimony a spouse can receive. It can also be used to keep from having to pay alimony.
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References
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