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Divorcing a Trust Fund Beneficiary

When considering divorce that involves a trust fund beneficiary it is important to have an understanding of how trust law works. In trust law, the person entitled to the benefit of the trust arrangement is considered the beneficiary.

To prepare when divorcing a trust fund beneficiary, keep in mind the following:

• Assets placed in a trust before marriage are usually treated as separate property.
• The trust protects the estates because once it was established; the trust then legally owns the property, nether the owner, nor the filing spouse.
• If an estate planning attorney is involved, their job will be to protect the trust beneficiary because it is their job to protect the wealth of the beneficiary
• Support and discretionary trusts can be used to protect the beneficiary and stop disbursements during a divorce
• If the trust beneficiary has no power to access or distribute the trust funds, they can be left penniless
• A family court judge may consider regular trust disbursements as income for purposes of calculating child and spousal support
• The spouse and the estate planning attorneys may be able and willing to negotiate a prenuptial, postnuptial or divorce agreement

There can be a fair amount of money involved when divorcing a trust fund beneficiary, and in many cases the trust beneficiary will spare no expense to protect their funds. In California, the family court’s authority to order the payout of unrestricted, support and spendthrift trust funds in divorce is limited. Due to the nature of the laws governing the marriage and divorcing of a trust beneficiary being so complicated, it’s important to speak with an experienced family law attorney to understand such a case.

Contact Thorsteinson Law Group to help you with your divorce. We provide complimentary consultations, and are dedicated to helping you through the divorce process.

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  • prenuptial postnuptial agreement process

Prenuptial and Postnuptial Agreement Process

Sometimes a person contemplating marriage needs a prenuptial agreement in order to protect the assets and income they are bringing into the marriage. Similarly, some people find that after they are married to one another, they wish to enter into an enforceable written contract concerning property rights and rights to future spousal support, should their marriage end. A prenuptial agreement, also known as a premarital agreement, and for many, a “prenup” is a written contract created by two people before they are married. A postnuptial agreement is created after two people are married. Regardless of the timing, the agreement basically lists all of the assets, property, debts, etc. each person owns and specifies what each person’s property rights will be after the marriage, or in case of divorce. The agreement will take into effect once the couple marries, or for postnuptial agreements, as soon as both parties sign.

The process of creating such an agreement with your soon to be spouse/ already spouse is not one to be taking lightly. For starters, you will need to work with your attorney to properly document and disclose all of your property and financial information. This would include a complete accounting of your assets, liabilities, and overall income. It is also essential to ensure that the agreement was properly signed, dated, and recognized within the jurisdiction of where you reside. You should examine whether you abide, or will abide by all of the obligations that were spelled out in the pre/postnuptial agreement. If the other party had accepted any benefits from you after those obligations were met, then that can be considered a permission of the agreement and it can become difficult to fight the document in a court of law in the case of divorce.

Another key recommendation is to make sure that your attorney has kept all the communication that had been exchanged during the pre/postnuptial negotiation process. This includes documenting any discussions that you might have had prior to the agreement being drawn or even later conversations between you and your fiancé/spouse during the process. This information can all be considered evidence during the court proceedings and can often be extremely valuable to supporting your agreement in the case of legal separation, or divorce.To ensure that the document will stand in a court of law, talk to a lawyer to go over the prenuptial and postnuptial process in further detail.

Contact Thorsteinson Law Group to help you. We provide complimentary consultations, and are dedicated to helping you through the divorce process.