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Most couples avoid talking about what might happen if the relationship fails. It’s not romantic to discuss a possible break-up, especially when we have waited so long for these official recognitions of our relationships, but it is definitely a prudent step. There are financial obligations and responsibilities that come with marriage, RDP’s, and civil unions, and they need to be discussed and understood as part of the package.
California is a “community property” state. Once you have tied the marital or RDP knot you begin to accumulate property together. Each spouse has an equal interest in all of the property acquired during the marriage/RDP/civil union, including each other’s income (with certain exceptions). Also, partners/spouses can be responsible for each other’s debts. If you want to dissolve your relationship, you must go to family court, where a judge must approve how you separate your property and finances.
Good planning may be even more essential for us than for our straight friends. Many of us have been in committed relationships for years, sharing homes and finances, without a thought about the legal ramifications of community property within a legal relationship. For those who want to enter a recognized relationship now, pre and post-marital/RDP agreements can make sense out of all the assets and debts that have been commingled over the years.
Here are some of the benefits of a pre-marital or pre-RDP:
•To protect each spouse/partner from being responsible for the other spouse’s/partner’s debts.
•To keep each spouse’s/partner’s income and assets separate.
•To define who gets what property if the relationship ends.
•To waive any legal claims to a spouse’s/partner’s estate.
There are several other reasons to consider creating an agreement. The right to same-sex marriage, RDP, or civil union is still new, and it is not recognized in a majority of states. An agreement may give you the power to control your relationship regardless of changes in laws or refusal of other jurisdictions to recognize your relationship. It is very important to preserve your rights and responsibilities when you are outside the state, and to include provisions in your agreement to protect your relationship wherever you may be.
Pre-marital/RDP agreements must be in writing, and must include full disclosure of each person’s assets, debts, and other financial details. The parties may waive this requirement in writing, but the lack of clear details defeats the purpose of an agreement, and can cause serious problems later if the relationship ends badly.
The agreement must be fair, and neither party can be coerced into signing it. Both persons should be represented by separate attorneys, or sign a waiver agreement to representation by a single attorney. Finally, the agreement must be signed at least seven days before the wedding, civil union or RDP.
Already married, an RDP, or in a civil union? It is never too late to sign an agreement to clearly structure your relationship with your spouse/partner. If you intend to stay in the relationship, you can create a post-marital/RDP agreement.
Here are some benefits of a post-marital, post-union or post-RDP agreement:
•To change the way property is held from community property to property owned separately by each, or vice versa. It is very important to consult a financial or legal advisor when making any changes to the character of property, since there could be adverse tax consequences.
•To clarify the ownership of property (real property such as a home; personal property such as automobiles, furniture, collectibles; and bank and investment accounts).
The legal requirements for post-marital/RDP/union agreements are similar to those for pre-marital/RDP/union agreements. It is not required that both persons have separate attorneys, but it is more likely the agreement will withstand attack if they do. There is wide latitude permitted in such agreements, but some types of provisions may not be upheld. For example, any provisions for money damages for sexual infidelity by one of the two, or for a financial penalty if one person’s drug addiction recurs. There is no mandatory seven day waiting period before signing the agreement.
This article was originally published HERE.