Timing Prenuptial Agreements
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Marriage offers the union of love, and it also involves the merging of assets, new tax requirements, and legal entitlements. As prospective spouses navigate asset management prior to their wedding day, how far in advance should prenuptial agreements be prepared? What’s the right timing for premarital agreements in North Carolina?
Long Engagements
Engaged couples with long engagements (six months or more) have time to decide how assets should be distributed in the event of divorce, negotiate and outline custody arrangements of current or future children, and manage financial misunderstandings. Long engagements offer time for adequate planning so that prenuptial agreements can be executed far in advance of the wedding day. Executing a prenuptial agreement a week before the wedding day may later result in claims of coercion or duress.
Short Engagements
Couples with short engagements may execute and file agreements close to the wedding day, possibly making assets vulnerable to a coercion claims in the future. For eloping couples or those who are planning a wedding in under six months, a couple may opt for a Do-It-Yourself prenuptial agreement. DIY premarital planning may not carry out each partners’ wishes as intended. Legislation changes, relocations, jurisdictions of assets in multiple states, all of these items may not be adequately addressed if a couple elects to quickly create a prenuptial agreement without the guidance of an estate planning lawyer.
Taxes and Prenuptial Agreements
In the event of death, premarital agreements can also serve as a guideline for tax purposes when it comes to determining a spouse’s taxable estate. Consulting a tax lawyer when preparing a prenuptial agreement can help address and minimize potential tax burdens.
Premarital Deadlines in North Carolina
In North Carolina, prenuptial agreements are regulated under the Uniform Premarital Agreement Act, Chapter 52B of the North Carolina General Statutes. The statutes provide no clear deadline, however, it is a good idea to have the agreement signed 30 days or more prior to the marriage in order to avoid accusations of coercion, undue influence, or an unconscionable agreement. One particular case, Howell v. Landry, showcases how North Carolina does not enforce a deadline. The case involved the wife making a claim of duress. She was allegedly given the premarital agreement a day before the wedding and told the wedding would not take place unless she signed the agreement. North Carolina courts rejected the wife’s claim.
Aside from deadlines, valid premarital agreements must be in writing and signed by both parties, and must include full disclosure of assets and income. The premarital agreement becomes effective upon marriage and can be amended or revoked afterwards upon signed authorization by both spouses.
