If you are contemplating marriage or are already married in Indianapolis, Indiana, it is crucial to understand how property division works in the event of a divorce. Indiana operates under equitable distribution principles, meaning the court aims for a fair and just distribution of marital assets, not necessarily an equal split.
In Indiana, the absence of a prenuptial or postnuptial agreement means almost all property acquired during the marriage is considered marital, potentially subject to division during divorce.
Prenuptial agreement
If the spouses want the marital assets to exclude separate assets, this should be included in a prenuptial agreement. Draft a prenuptial agreement before marriage to outline the division of property and address other issues like spousal support, child custody and inheritance rights. Ensure the agreement is fair, voluntary and in writing, with full disclosure of assets and liabilities.
Postnuptial agreement
Even if you are married, as a couple, you can agree to recognize separate property. If married, consider a postnuptial agreement, similar to a prenuptial agreement but executed after marriage. This can be useful for addressing changes in financial situations, acquiring new assets or altering terms from a prenuptial agreement.
Separate bank accounts
If you have a prenuptial or postnuptial agreement, maintain separate bank accounts for personal income and expenses to avoid commingling funds. Joint accounts may be considered marital property, so keeping finances separate can help protect your assets and help maintain your agreements.
Separate titles and deeds
Ensure that real estate and vehicles remain in the name of the person they are supposed to per the terms of the prenuptial or postnuptial agreement. Joint ownership or using joint funds may subject these assets to division in divorce. Keeping separate titles and deeds safeguards your property rights in line with your wishes with the prenuptial or postnuptial agreement.
Record keeping
Per the terms of your prenuptial or postnuptial agreement, maintain meticulous records and receipts for assets and debts. This includes preserving prenuptial or postnuptial agreements, bank statements and transaction records. This documentation serves as evidence of the separation of property and the maintaining of your agreement.
While Indiana’s marital property laws pose challenges, proactive measures can protect your individual assets. By securing legally sound agreements, maintaining financial independence and keeping comprehensive records, couples may reduce conflicts during property division in the event of a divorce.