A Prenup also known as a prenuptial agreement is a written contract created by a (sometimes engaged) couple before they are set to be married. The contract typically outlines all of the property owned by each person; this can include cars, stock accounts, bank accounts, etc.. All items are specified in the written contract so that each person can determine what is to happen to that property, if the marriage were to ever end with divorce.
North Carolina has adopted the Uniform Premarital Agreement Act (UPAA). The UPAA allows parties to contract with respect to:
1. Division of Property - the division of property during marriage and upon divorce.
2. Alimony - Alimony and the waiver of alimony. Waiver of alimony agreements will be upheld unless doing so will cause the disadvantaged spouse to be eligible for public assistance.
3. Child Support - Child support arrangements will be upheld as long as they provide for the reasonable needs of the child(ren).
There are some people that believe the rich and famous are the only ones to create prenups BUT this is not true. Prenups are merely used to protect the assets of each individual, avoid conflict in the event of divorce, avoid your significant others debts, as well as clarify finances with your significant other. Without a prenup the property is split as martial property in a divorce judgement.
If you are thinking about creating a prenup with you and your significant other we can help to draft the document for you. Keep in mind that an attorney is not needed to create a valid pre-marital agreement. Failing to hire a family law attorney may, however, affect whether the agreement is fair. An agreement that is not fair will probably not be valid.
Adkins Law is able to provide you with advice and assistance with the creation and validity of a prenup and pre-marital agreement. Contact us today to schedule your meeting with an attorney.
Depending on the ruling of the court, an alimony order can be for a set number of years or even life. In order to modify spousal support, whether that be alimony or post-separation support, significant changes are normally necessary. The termination of an alimony order is automatic upon the death of either party, remarriage of the dependent spouse, or cohabitation by the dependent spouse. That being said, what determines cohabitation in North Carolina?
According to North Carolina state law, cohabitation requires:
It is important to take notice that, although the court requires two people to essentially be living together in order to terminate an alimony order, that does not mean that they must be retaining the same residence. The dependent spouse and third party may each retain a separate residence and still be considered living together.
The second criteria the court will look to is whether the dependent and third party act like a married couple. There are numerous facts considered by the North Carolina courts. There is no one item that is required or determinative.
Some factors considered in determining cohabitation:
Although cohabitation is defined by statute, it is often a source of litigation in court. Seeing as the dependent receiving alimony has an incentive to alter behavior to avoid losing their monthly check, these types of cases may get a bit grey at times. This may include keeping a separate residence, limiting the nights spent together per week, not keeping their belongings at the other party’s place, not getting engaged, etc. This behavior can make it quite frustrating for the person ordered to pay. Often, testimony from a private investigator, phone records, and bank records help to establish cohabitation.
When a married couple dies, they are able to exempt a certain amount of their estate from taxes. Portability allows the first spouse who dies to transfer their unused estate tax applicable exclusion to the other, living, spouse. This amount can then be used for their gift or estate tax purposes when the second spouse dies. The exemption amount changes every year due to inflation.
The best way to understand this is as follows:
Margaret and John are a married couple. When Margaret dies in 2011, the executor of her estate makes the portability election. Assume that Margret’s “deceased spousal unused exclusion” (DSUE) amount is $4 million. In 2013, the basic applicable exclusion amount equals $5.25 million, and John dies. Now the applicable amount available to John’s estate equals $9.25 million because he can add the $4 million that was not used by his spouse to his maximum amount.
This is calculated by adding the surviving spouse’s (John) basic applicable exclusion amount and the aggregate DSUE amount from Margaret.
Why does it matter?
The effect of portability is it potentially doubles the estate tax exemption available to the surviving spouse to use for lifetime gifts or at the second death. Because estates are taxed at such a high rate, preserving portability means that the heirs will ultimately be able to receive more money.
Even if your estate is not very large, preserving portability can protect your assets in the future if the surviving spouse experiences a windfall (like winning the lottery!) and is an option that can and should be explored by everyone, even if it ends up not being the best strategy for your estate.
How to utilize portability?
Portability is not automatic, and it is very important that the executor follow the proper protocol. In order to utilize portability, there are several requirements that must be met:
First, an election must be made by the executor of the estate. If an election is not made, portability is forfeited.
Second, the election must be timely filed on or before nine months after the deceased spouse’s date of death. If more time is needed, an automatic six- month extension of time to file the return can be requested through Form 4768. If the deadline is missed and there is no extension, then the couple will not have the benefit of estate tax portability, and this may result in thousands of dollars of unnecessary and avoidable estate taxes.
Third, a complete and properly prepared Form 706 must be filed.
If you are interested in learning more about the portability exception and how it applies to your estate, contact Adkins Law to set up a consult today!
By: Jacqueline Keenan
Unlike a divorce, which is the end of a marriage between two individuals, an annulment declares that a marriage never existed. This is a rare procedure and has very narrow requirements in North Carolina.
Requirements for Annulment in North Carolina
In order to procure an annulment, it must be shown that the marriage is void or voidable. The only situations in which an annulment can be granted are:
All of the other factors are “voidable”, meaning that there is a problem with the legality of the marriage that can lead to the marriage being erased if an annulment is procured. Because these marriages are not immediately void, they may be ratified by the conduct of the parties—meaning if you continue to live together or have children together, you may not be able to seek an annulment. If an annulment is not possible, then it is time to consider a divorce.
I think I qualify for an annulment. Now what?
Contact Adkins Law! We are happy to help you determine if you are in fact eligible for an annulment, and what your next steps should be!
When addiction strikes, it can have detrimental effects on a marriage, any children involved, and extended family members. According to the American Association for Marriage and Family Therapy (AAMFT), fighting and stress caused by financial and emotional issues can set the couple up for a vicious cycle of substance abuse to cope with tension created by increased conflict. Domestic violence is often an issue in instances where alcohol abuse or substance abuse is present. Leaving a loved one due to substance abuse is difficult because of the years spent invested in building a relationship. Fortunately, there is hope for salvaging a relationship through the assistance of therapy and treatment.
Signs of Substance Abuse
The first step in repairing the damage created by substance abuse is to identify abuse as the root cause for marital problems. It is an emotional and cognitive struggle to come to the realization that a person’s loved one has resorted to using drugs or alcohol to the point of addiction. While it is nearly impossible to come up with a comprehensive list including all of a the signs that determine whether a spouse is suffering from an addition, below is a list of signs that can help determine if a person is abusing drugs or alcohol:
According to the AAMTF, substance abuse by a partner damages a relationship and these issues need to be treated too. If the underlying issues remain unchecked, it can lead to a relapse. These issues do not simply disappear once an individual has stopped drinking or the drug use has stopped. Eliminating drinking or drug use is only the starting point, once sobriety is attained, the presence of a supportive caring relationship can be one of the strongest factors in sustaining sobriety.