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How Much Do You Know About Marriage and Law?

There is an assumption that if your marriage is rocky, you only have two choices — remain married and miserable or divorce and become happy. This is not necessarily true. Studies show that as many as two-thirds of people who report being in an unhappy marriage but avoid divorce are happier with their marriage within five years.

Why is this so?

  • If you loved someone enough to plan your dream wedding with him or her, you will likely get past marital problems. In fact, the same study shows that stubbornness is one of the primary reasons couples outlast problems and overcome problems.
  • Our brains change with age. Research shows significant “mellowing” comes as people mature, which allows them to better cope with negative emotions and improves their ability to recognize happiness. The spare tire around a husband’s gut becomes irrelevant if he makes his wife happy even without any weight loss.
  • Many unhappy couples realize that the solution to their marital problems is not a visit to the divorce lawyer. Divorce can increase the acrimony in the relationship and negatively impact any children of the marriage.

Even though over half of married couples will never divorce, it is useful for everyone to understand the legal relationship that a marriage creates. These legal rights extend across the board including tax law, estate law, and contract law. Here are eight things to know about marriage and law:

Divorce Law

In the eyes of the law, marriage is a legal construct. It defines the legal relationship between the spouses. It also defines the legal relationship between the couple and the rest of the world.

On average, over 44,000 weddings take place every weekend. Each of these married couples get a number of legal rights at the end of that wedding ceremony.

  • Assets obtained after the marriage are considered to be owned by the couple.
  • Debts incurred after the marriage are considered to be owed by the couple.
  • The spouses are considered next of kin for purposes of making decisions if the other spouse is unconscious or dead.
  • The spouses are presumed to be beneficiaries for each others’ insurance and death benefits through Social Security, Veterans Affairs, and retirement accounts.
  • The spouses are automatically in line to receive any inherited property unless there is a will or prenuptial agreement to the contrary.

Divorce is the process of unwinding a marriage. In the eyes of the law, the reasons for the divorce are almost entirely irrelevant. Just as a business owner need not explain the reasons for dissolving a business, a spouse need not explain the reasons for dissolving a marriage. In either case, the law does not imprison a person in a legal relationship.

Divorce lawyers advocate for two primary aspects to a divorce — property division and child custody. Property division can take place under two theories depending on the state you live in.

  1. Community property: A fairly formulaic division of property results in roughly equal shares.
  2. Equitable division: Judges are allowed to exercise their discretion to achieve a “fair” result even in property is not divided equally.

For example, think of the marital estate as a pile of desserts (assets) and vegetables (debts). In a community property state, each ex-spouse gets half of the desserts and half of the vegetables.

In an equitable division state, divorce lawyers present their case for something other than an equal division of property. For example, the higher-earning spouse may receive fewer desserts and more vegetables based on the higher salary. Alternatively, a divorce lawyer in an equitable division state can argue that larger assets can be balanced with larger debts to maintain equity. For example, if one spouse wants to keep her expensive car, she may also get a larger share of the credit card debt to balance out the value of the car.

Spousal support (also called alimony) is often based on the roles of the spouses during the marriage. A divorce lawyer would argue that a homemaker is entitled to alimony based on the sacrifice made to care for the home rather than seeking training and job advancement.

Child custody is always handled using the “best interests of the child” test. This test considers every aspect, including the parent-child relationship, financial condition, living situation, and capability of each parent. Although the law used to presume the mother was better situated to care for children, this is no longer true in most states. Rather, the divorce lawyers for both parents are on equal footing when they fight for custody of the children.

Child custody also includes visitation and child support. Once legal and physical custody is determined, the divorce lawyers will argue for visitation so that children can benefit from time with both parents more or less equally. Similarly, the divorce lawyers will argue for child support to the parent who has physical custody of the children to offset expenses associated with taking care of the children. Most states use a table that defines the child support due based on the relative income levels of the parents and the number of children.

Property Law

As a general rule property that belonged to you before marriage remains yours during and after the marriage. For example, if you bought a car before the marriage, your spouse would not have the legal right to either ask that you sell the car during the marriage or ask for half its value if you ever divorce.

In fact, this is highlighted by one very common question to divorce lawyers — what happens to the wedding rings during a divorce? In the normal situation in which the wedding rings were purchased before the marriage using “separate” income rather than after the marriage using “marital” income, the rings are separate property that was given to the other person as a gift. Therefore, the wife’s wedding ring remains her property after a divorce and the husband’s wedding ring remains his property after a divorce.

For the most part, property obtained during the marriage is marital property. This means that both spouses have equal rights in the property regardless of whose name is on the deed or title. For example, one spouse cannot unilaterally kick the other spouse out of their shared house until a court issues an order. Until that point, both spouses have the right to live in that home.

Insurance Law

There is no obligation for spouses to have the same insurance. In fact, many working couples have different health plans through their employers. When they choose insurance for their children, they usually make the decision based on financial considerations insuring them under the plan with the best coverage with the lowest premiums.

When an employer offers health insurance as a benefit, it usually offers to cover spouses and children of employees, although employers are not required to cover dependents. If it covers dependents, the employer is allowed to require the employee to contribute to the health insurance premiums for the spouse and children.

In the event of a divorce, U.S. law requires the employer’s health plan to offer to continue coverage for the ex-spouse for up to 36 months after the divorce. Under these COBRA rights, a health plan can require the ex-spouse to pay the premiums associate with the insurance coverage. However, depending on the relative financial situations of the ex-spouses, a divorce lawyer may be able to include payment of insurance premiums with the spousal support ordered by the court.

Contract Law

Under the old common law, a married woman could not enter into a contract without her husband’s signature. However, times have changed. Any contract signed by a married woman is enforceable regardless of whether her husband signed it as long as he knew about it or benefited from it.

For example, if a spouse (either husband or wife) signs an installment loan contract for new furniture, the finance company can enforce the contract regardless of whether both spouses signed the contract as long as the furniture is used in the marital home and both spouses are aware of the contract to pay for the furniture. If the couple misses a payment on the loan, the finance company can repossess the furniture or undertake any other remedy under the loan contract.

The exception to this rule is that if a spouse does not know about the contract, it is not enforceable against him or her. To take another example, if a cheating spouse buys an expensive edible flower arrangement for that spouse’s “friend,” and specifically conceals that purchase from the other spouse, the unknowing spouse is not legally responsible if the bill for the gift is not paid.

Debtor/Creditor Law

Broadly speaking, the same principles apply to debts as contracts with one exception. Usually, debts incurred during the marriage are considered marital debts as long as the marriage benefits from the debt. Conversely, debts incurred before the marriage are considered separate debts and the non-incurring spouse is not responsible for them.

In one example, a bride who incurs debt making wedding arrangements before the marriage is solely responsible for that debt, even though the debt was incurred for the couple’s benefit. This is because the debt was incurred before the marriage.

Conversely, if a married couple incurs medical debt due to one of the spouse’s health problems, it is considered a marital debt even if only one spouse was ill. Thus, marital debt to a female health care provider for a wife’s illness will be shared equally by both spouses in the event of a divorce.

This is one reason divorce lawyers will sometimes recommend the strategy of legally separating or divorcing in the event of one spouse’s serious illness. This strategy, although somewhat cold, a divorce lawyer can sometimes be the best way to avoid financial ruin for the couple. Using divorce in this way, the ill spouse can incur medical debt separately and, if necessary, declare bankruptcy separately. Simultaneously, the well spouse can protect half of the assets from the medical debt and bankruptcy proceedings.

Tax Law

While some argue that it is discriminatory against single people, U.S. tax law gives substantial benefits to married couples. The marital tax deduction allows unlimited asset transfers between spouses without taxation. This also includes tax-free inheritances and gifts.

Moreover, joint tax filers are entitled to take a larger standard deduction and are entitled to some tax credits that are not available to single tax filers. While these benefits apply to any married couple, they are particularly useful when one spouse earns substantially more than the other spouse.

Elder Law

As couples age, many legal issues arise. One of the most significant is health care decisions. If one spouse becomes incapacitated, the other spouse is considered to be the sole person who can make health care decisions. For example, if one spouse is comatose, the other spouse can decide what, if any, medical procedures are authorized and what measures can be taken to keep the spouse alive.

In the past, a durable power of attorney or health care power of attorney was needed by same sex couples to have the authority to make these decisions. With the coming of marriage equality, all married couples have the same rights to make health care decisions for each other.

This issue can also come up in cases of dementia. As baby boomers age, the number of people with dementia is growing. These people will not only need someone to care for them but also someone to make decisions for them. Under the law, the spouse has the legal authority to place the dementia patient into long term care, manage the couple’s assets, and make any health care decisions.

Estate Law

One of the greatest benefits of marriage is the ability to plan the couple’s estate together. In most situations, the spouses name each other to inherit the estate. Since most of their property is co-owned by the couple, this means that everything that was jointly owned will be transferred into the name of the surviving spouse.

However, there are other ways an estate planning lawyer can structure a married couple’s estate. For example, a couple can place all their assets into a living trust. A trust is like a corporation in the sense that it has a life of its own that is not tied to the lives of any people. Thus, if one spouse dies, the trust continues to hold the couple’s assets and can be used by the surviving spouse to pay for any living expenses.

When the remaining spouse dies, the trust lives on, usually to distribute the assets held in the trust. For example, if the couple has children, the document that formed the trust will usually include language to pass the assets, or liquidate the assets and pass the money raised, to the couple’s children.

This is the source of the phrase “trust fund baby.” Often these trusts will continue in existence distributing the funds to the children over time. Occasionally, the distribution is conditional. For example, a son may receive trust funds only if he graduates from college.

Marriage has important legal ramifications. In fact, marriage is probably the most significant legal relationship most people will enter into besides a mortgage. A marriage (and a divorce) will govern the financial, health care, inheritance, tax, contract, and debtor rights for the couple.

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