Articles
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With almost half of every marriage ending in divorce, it is important to plan for subsequent marriages. This includes not only premarital agreements, but also estate planning prior to marriage. A premarital agreement is recommended if one or both spouses have substantial assets or there is any concern about the marriage and should always be considered in subsequent marriages. A premarital agreement is a contract governed by ordinary contract law and by Indiana's new statute on premarital agreements. The consideration for the contract is the marriage. Premarital agreements can cover a wide variety of topics. These include division of premarital property, division of premarital property, division of postmarital property, the disposition of real estate and personal property, as well as many other issues. Premarital agreements are recognized and enforceable in Indiana. Another important planning device is the Qualified Terminable Interest Property Trust (QTIP Trust). The QTIP Trust allows a person to make a lifetime or death gift to a spouse. The gift is made to a trust. The trust provides the spouse with income for life, and, at the death of the spouse, the remaining principal can go either to children by a prior marriage or to anyone else determined by the spouse who made the gift. There also may be payments from the principal if allowed by the terms of the trust instrument. This is an excellent vehicle for a well-to-do spouse to make a gift to the spouse with less property to assure that the gift will be for life only and will not be transferred to any third party. It is also important with any subsequent marriage to make certain that health care powers and powers of attorney are properly revised. Adult children from a prior marriage, for example, can be the attorney in fact under the health care power. It is important to redo all health care powers and powers of attorney either shortly before, or immediately after, the subsequent marriage. Finally, under Indiana law, a divorce may make a prior will void. This means that new wills are an absolute necessity. The wills for a second marriage can be conditional wills, which become operative only in the event of marriage. Or the wills can be done shortly after the subsequent marriage. In any event, the important consideration again is to plan and make certain that you have properly planned and are not left in a vulnerable position. § |
