Owning real estate in Connecticut is a significant investment. It can be a primary residence, a vacation getaway or a rental property that generates income. But what happens to that property if you get married? In Connecticut, with its equitable distribution laws, any assets acquired during the marriage become marital property, subject to division during a divorce. This can include your cherished real estate.
However, there are strategies Connecticut property owners can explore to potentially shield their real estate from becoming marital property. Let’s delve into some options to consider:
Premarital agreement: A clear conversation before “I do”
A premarital agreement, also known as a prenup, is a legally binding contract drafted before marriage. It outlines how assets and debts will be divided in the event of a divorce. Within this agreement, you can specify that your existing real estate remains your separate property. This approach fosters open communication with your future spouse about finances and protects your premarital investment.
Keeping records straight: Inheritance, gifts and separate funds
Property acquired through inheritance or as a gift before marriage is generally considered separate property. Meticulous record-keeping is vital here. Maintain clear documentation like wills, deeds and gift receipts to demonstrate the property’s origin.
Similarly, using separate funds—money you earned or saved before marriage—to purchase real estate and keep finances separate throughout the marriage strengthens the case for the property remaining separate.
Holding title strategically: Tenants in common vs. joint tenants
The way you hold title to your property with your spouse can also impact its marital status. Here’s a breakdown of two common options:
- Tenants in common: Each spouse owns a distinct, severable share (e.g., 50/50). Upon death or divorce, the ownership interest passes according to the owner’s will or intestacy laws. This approach allows you to maintain some control over your share.
- Joint tenants with rights of survivorship (JTWROS): Upon the death of one owner, ownership automatically passes to the surviving spouse. While convenient for estate planning, this doesn’t shield the property from marital distribution.
Consulting with an experienced family law attorney is crucial to determine the most suitable titling strategy for your situation.
Protecting your investment with knowledge and planning
By understanding Connecticut’s marital property laws and exploring available strategies, you can take proactive steps to safeguard your real estate investment. Remember, each situation is unique, and legal advice from a qualified professional is vital. With careful planning and open communication, you can ensure your real estate remains a secure part of your financial future.
