Divorce and Asset Protection
The best time to take measures to limit the financial consequences of a divorce is before entering into the contract of marriage, if possible. Unfortunately, divorce is all too common in our society, and it often pays to at least consider this possibility before saying “I do.” Depending upon your circumstances, there may be several ways in which to retain as many of your personal assets as possible in the event that a marriage does not work out as you had hoped. Even if precautions are not taken prior to a marriage, there may still be some ways to limit your financial exposure in the event of a divorce. Nashville family law attorney Randy Ratliff regularly assists people who need guidance regarding divorce and asset protection.
A well-drafted premarital agreement can clarify a prospective spouse’s separate property going into the marriage and provide for the distribution of assets in the event of a divorce. Of course, there is always a chance that such an agreement will be declared invalid by the courts, so a back-up plan (such as a domestic asset protection trust or a similar document) may be advisable in some circumstances. An irrevocable trust may also help shield assets from creditors and even be of assistance in helping the settlor of the trust qualify for Medicaid or TennCare should nursing home care be necessary at some point in the future. A knowledgeable estate planning attorney can help explain how different types of trusts work and how they can be part of an overall asset protection plan.Divorce and Asset Protection Under Tennessee’s Divorce Laws
Tennessee is not a “community property” state in which there is a presumption that all marital property should be split 50/50. Instead, the Tennessee courts follow the law of “equitable distribution,” which may – or may not – result in an equal, 50/50 distribution of assets between the spouses. In deciding “who gets what,” the first thing that the divorce court must do is define the marital estate. Generally, marital property consists of property that is acquired during the marriage. An asset owned by only one spouse prior to the marriage is not usually considered “marital property” unless the asset was comingled during the marriage. For instance, if a wife owned a home prior to the marriage, and the parties reside in that home at the time of the divorce, the wife will probably retain ownership of the home if it is still in her name only. However, if she added her husband’s name as co-owner, or if he invested a substantial sum into the home (by funding an addition to the home out of his retirement income, for example), the court may find that the home is now marital property.
Tennessee courts also look at factors such as the parties’ relative contributions to the marriage and the needs and means of each spouse. Importantly, fault is not to be considered in dividing a marital estate during divorce proceedings. If minor children are involved, the court may also look at custody, child support, and visitation concerns in considering the overall division of the parties’ assets and debts. Because of the uncertainty involved in a divorce court’s distribution of marital assets, it is important to take appropriate steps to protect one’s personal estate.Retain a Divorce Lawyer in the Nashville Area to Protect Your Financial Future
Nobody goes into a marriage expecting it to end in divorce, but the statistics do not lie. About one in four first-time marriages will not last. It makes sense to plan for this contingency, preferably before you enter into a new marriage. If you are already in a marriage that is struggling, it might also be a good time to take a look at how divorce and asset protection may work in your situation. To schedule an appointment with a knowledgeable Nashville lawyer, call the Randy Ratliff Law Offices, PLLC, at 615-656-8282 or contact us online. Randy Ratliff assists people who need a divorce attorney or an estate planning lawyer in both Davidson and Williamson Counties, including in cities such as Nashville, Brentwood, Cool Springs, Franklin, Madison, Antioch, Goodlettsville, and Hermitage.