How does a prenup work in Wisconsin?
What is a prenuptial agreement?
A “prenup” is a marital property agreement entered into prior to marriage. It defines the parties’ rights and responsibilities with respect to individual and marital property and often modifies or reclassifies those rights versus what they would normally be under the law in the absence of such an agreement.
Who Should Get a Prenuptial Agreement?
People in the following situations should consider the benefits of a prenuptial agreement:
- One or both parties have considerable premarital debt
- One or both parties have considerable assets or income
- There is a large disparity in the parties’ wealth or earning capacities and they want to account for this in any future distribution of wealth or income upon death or divorce
- One or both spouses own a business and want or need to keep their borrowing and tax liabilities separate from their spouse
- One or both parties is getting remarried or has children from a prior relationship
Pros vs Cons
The advantages of a prenup include:
- You can define your own individual and marital property rights
- You can mitigate your liability for certain debts of your spouse
- You can protect a business and a spouse’s business partners
- You can protect assets for the benefit of children from a prior relationship
- You can mitigate family disputes upon the death of either party
- You can simplify and facilitate a settlement in the event of your divorce
The risks of not moving forward with a prenup include:
- If you do not enter into a prenuptial agreement, your property rights will be defined by the statutes and the caselaw interpreting those statutes—which may or may not conform to your wishes. Without a prenup, it is possible that individual property that you wish to keep separate will become marital property on your marriage or that debts your spouse incurs and that you do not want to be responsible for will become your responsibility.
- It is also possible that refusing to enter into a prenup will delay or cancel the wedding if one party does not want to go through with the marriage without a prenup.
Considerations to Make Before Signing
Prenups require that both parties make a full financial disclosure to be enforceable. They also cannot be purely one-sided. That is, they cannot solely protect one party. They must be fair and equitable to both parties.
Before entering into a prenuptial agreement, both parties should meet with their own separate lawyers (one lawyer cannot represent both parties) to discuss:
- Their rights and responsibilities under a prenuptial agreement
- Their rights and responsibilities in the absence of a prenuptial agreement
- The limitations of what a prenup can and cannot do (for example, a prenup cannot establish a future child support amount or how many children the parties agree to have).
- What assets or liabilities they wish to reclassify or protect and what, specifically, they want to classify as individual versus marital property
- How they want property to be owned, titled, and managed during the marriage
- How they want property divided or awarded if they divorce
- How they want their property distributed in the event of their death
Common Prenuptial Agreement Clauses
Most of the provisions of a prenup that you read about in the news are not viable in Wisconsin. A Wisconsin marital property agreement serves a specific purpose: To define individual and marital property. It does not (and, by law, cannot) dictate how parties behave during the marriage or establish rules for how to create and manage a family, etc.
- By law, a prenuptial agreement cannot affect a child’s rights to receive child support
- Clauses that create disincentives such as fines or punishments for behavior such as cheating are unenforceable in Wisconsin.
- A prenup can define marital property rights both during a marriage and upon dissolution of the marriage via death or divorce, however, if parties want the prenup to apply in both instances, it must specify that it applies to death and divorce and not just one or the other.
- Pets are considered personal property in Wisconsin; therefore, ownership of a pet and financial responsibility for it can be defined in a prenuptial agreement.
- Rules governing how to parent children, divide household chores, or how often the parties must have sex are unenforceable in Wisconsin.
Will a Prenup Protect me From My Spouse’s Debts?
A prenup will only protect you from liability for your spouse’s debts if the prenup specifically assigns responsibility to the liable spouse and the creditor has actual notice of the provision prior to extending credit to the liable spouse.
You cannot use a prenuptial agreement to avoid creditors by transferring all assets to the non-liable spouse.
A prenuptial agreement is a contract between two parties to a marriage. It does not affect a creditor’s rights as they are not parties to the contract. A prenup will not prevent one spouse from being garnished or sued for the other party’s debts, however, a prenup may require that the liable spouse must indemnify or reimburse the non-liable spouse.
Process for Getting a Prenup
- First, talk to your intended spouse about whether a prenuptial agreement would be beneficial; if you both agree it would be, then you should contact attorneys.
- Discuss which assets or income you want to classify as individual and marital property.
- Talk to your lawyers about the details of how to best structure your agreement.
- Provide detailed financial information to your lawyers to be exchanged with your intended spouse
- Ask questions, clarify, or gather additional financial information until both parties have a full and fair understanding of the other party’s financial circumstances.
- Your attorneys will draft the agreement; you and your spouse will review it and will refine and negotiate it through your attorneys.
- When it meets with both parties’ approval, it will be signed.
- Your attorneys may or may not recommend filing it with the county Register of Deeds.
The entire process for drafting and finalizing a prenuptial agreement takes approximately two to three months. The final agreement should be signed at least two weeks before the wedding—to give both parties plenty of time to consider the terms and consequences of the agreement.
The agreement should not be hastily drafted at the last minute or signed the day of the wedding as such circumstances can later be cited as proof the agreement was signed under duress—this could possibly invalidate the agreement.
How much does getting a prenuptial agreement cost?
Short answer: It depends.
Fees for prenups are charged on an hourly basis—that means the ultimate fee is based on the amount of time it takes for your lawyers to negotiate it, prepare it, and finalize it. This will depend on how organized the parties are in presenting their wishes to their attorneys and in providing them with detailed financial information. It will also depend on how well the parties get along during negotiations. It will also depend on the nature of the property being reclassified and whether or not the parties agree on the values of the property.
Does a prenup have to be written by a lawyer?
Short answer: No.
Technically, anyone can draft a prenuptial agreement. There are multiple forms available for download on the internet. However, different states have different rules for what can and cannot be included in prenuptial agreements and different states also have different rules about what makes a prenup enforceable or unenforceable. Therefore, parties should always consult with an attorney to ensure that their ideas can be implemented. To be certain a prenup is enforceable under the law and that it works the way the parties intend, it should be drafted by an attorney.
Can you get a prenup after marriage?
Short answer: Yes.
A marital property agreement entered into after marriage is a called a “postnup” and follows the same rules for enforceability as prenuptial agreements.
How long does a prenup last?
A prenup lasts until its terms are fulfilled—that is, until all property to which it applies is distributed upon death or divorce as defined by the agreement.
Alternatively, a prenup can end upon order of the court if a judge terminates the agreement for any reason.
A prenup can also be terminated by both parties by a subsequent written agreement specifically terminating the prenup.
How to Nullify a Prenuptial Agreement
A prenup can only be “nullified” by court order or by written agreement of the parties.
A prenup cannot be unilaterally cancelled by only one party.
Tearing up a prenuptial agreement does not invalidate it.
Can prenups be overturned?
Short answer: Not exactly.
Prenups are not “overturned”—however, they can be declared unenforceable.
Usually, a prenup is only declared unenforceable after a hearing or trial. A prenup will be declared unenforceable if:
- The agreement was “unconscionable when made.” (Meaning the terms are so egregiously unfair or one-sided that it would be shocking to a reasonable person).
- A spouse did not enter into the agreement freely and voluntarily.
- A spouse did not receive a fair and reasonable disclosure of the other party’s property and financial obligations before signing the agreement and did not otherwise have notice of the other party’s property and financial obligations.
Talk to a Prenup Lawyer
To discuss whether a prenuptial or postnuptial agreement would be beneficial for you and your spouse, or if you have been asked to sign a prenup or postnup by your intended spouse and want to know what your rights are, do not hesitate to contact us for a free consultation today!