How Your Status Changes: legal effects of marriage
You have announced to the world that you are a couple in love. Your legal marriage will do much more. It will create a legal union with its own unique rights and responsibilities. State marriage laws will define these rights and responsibilities, especially those related to property and support.
Marriage will change your rights in many ways:
- You will be eligible to live in neighborhoods zoned for “families only”.
- You will have the right to own property together and inherit property from each other.
- You will pay special rates for insurance (car, home, health, etc).
- You can make medical and financial decisions for each other in emergencies.
- You don’t have to testify against each other in court.
- You can file a joint return or create a family partnership to divide business income.
- You will be able to set up trusts to reduce estate taxes; and receive benefits from pensions, Social Security, Medicaid and disability income insurance.
- You can make tax-free gifts to each other, with no limit on the dollar amount.
- You are also entitled to sue if your spouse dies because of a “wrongful” act by another person.
- You will inherit, from your spouse, if they die without a will.
- You will be able to claim dependency deductions if you have children.
As with any rights, there are also responsibilities:
- You are responsible for filing your tax return as either married or married and filing single. Speak with your accountant as to which is better for you financially.
- Just as you can enjoy the combining of two incomes, you are also responsible for debts. Be sure to fully disclose and discuss responsibility for any loans prior to the marriage and any that you may accumulate throughout the marriage, ie: mortgage.
- Should your marriage end, either of you may have the duty to pay child support (and sometimes spousal support/alimony)
Be sure to consult your accountant or lawyer to see how you might benefit financially from your newly formed union. Why not put it in writing? We urge everyone to have a marriage contract or prenuptial agreement tailored to the needs of the couple. To be considered by the courts, the document must be drawn-up well in advance of the wedding ceremony. Don’t set-up a home without one.
Remember: Should your marriage end in death or divorce, you may find yourself at the mercy of the courts when your marital assets and debts are divided unless you act now in creating your personal marriage contract.
Click here to read more about How (and Why) to Create a Prenuptial Agreement.