Estate planning serves several crucial purposes, such as ensuring the organized distribution of assets after one’s passing, protecting assets during one’s lifetime, and providing financial security for loved ones in the event of death or incapacity. A comprehensive estate plan often utilizes various tools to achieve these objectives. For some people, a postnuptial agreement is one of those tools. With that in mind, the Indianapolis attorneys at Frank & Kraft discuss how a postnuptial agreement might fit into your Indiana estate plan.
Understanding an Indiana Postnuptial Agreement
Similar to the more widely known prenuptial agreement, an Indiana postnuptial agreement is distinguished by its execution after marriage rather than before marriage. Because a prenuptial agreement is entered into before marriage, and before any marital rights exist, these agreements are typically treated like any other agreement between unrelated equal parties. A postnuptial agreement, however, impact existing marital rights, often causing judges to scrutinize such an agreement more carefully to make sure that a party was not coerced into signing the agreement and/or that one party did not have an unfair advantage when negotiating the agreement.
What Can Be Agreed Upon in an Indiana Postnuptial Agreement?
Fundamentally, a postnuptial agreement is a contractual arrangement between spouses that can define property and asset rights in the event of death or divorce as well as address asset management during the marriage. Indiana law explicitly outlines what can be included in pre or postnuptial agreements, including:
- The rights and obligations of each of the parties in any property of either or both of them whenever and wherever acquired or located.
- The right to: buy, sell, use, exchange, abandon, lease, consume, expend, assign, create a security interest in, mortgage, encumber, dispose of, or otherwise manage and control property.
- The disposition of property upon legal separation, dissolution of marriage, death, or the occurrence or nonoccurrence of any other event.
- The modification or elimination of spousal maintenance.
- The making of a Will, a trust, or other arrangement to carry out the provisions of the agreement.
- The ownership rights in and disposition of a death benefit from a life insurance policy.
- The choice of law governing the construction of the agreement.
- Any other matter not in violation of public policy or a statute imposing a criminal penalty, including the personal rights and obligations of the parties.
Note: Child support cannot be agreed to or adversely affected by a postnuptial (or prenuptial) agreement.
Enforcement of an Indiana Postnuptial Agreement
To be enforceable in Indiana, a postnuptial agreement must be in writing and signed by both parties. Courts may decline to enforce such agreements if they find that they were not executed voluntarily or were a result of fraud, duress, coercion, or overreaching. Additionally, the agreement should not have been unconscionable at the time of execution, with fair and reasonable disclosure of property or financial obligations provided to both parties.
How Does a Postnuptial Agreement Fit into My Indiana Estate Plan?
A postnuptial agreement can be a valuable addition to your Indiana estate plan, offering clarity regarding the intentions of the parties as to the distribution of assets in the event of one spouse’s death. While it cannot replace a Last Will and Testament or trust agreement for post-death asset distribution, it can serve as supporting evidence in case of challenges to the decedent’s intent during probate proceedings.
Do You Have Questions about How an Indiana Postnuptial Agreement Fits into Your Estate Plan?
For more information, please join us for an upcoming FREE seminar. If you have additions questions about an Indiana postnuptial agreement, contact an experienced Indianapolis estate planning attorney at Frank & Kraft by calling (317) 684-1100 to schedule an appointment.