What are Sunset Clauses in Premarital Agreements?

Many people today are drafting a premarital agreement, also known as a prenuptial agreement, before they get married. These legal documents are no longer viewed as romance killers or reserved only for the wealthy or famous. Although no one wants to get married thinking about divorce, the unfortunate reality is that it does happen.

Premarital agreements are most commonly used to specify which property is marital and which is separate. Provisions for alimony can also be included in these documents. Below, our Tampa Bay prenuptial agreement attorney explains more about these clauses.

What is a Sunset Clause in a Premarital Agreement? 

A sunset clause in a premarital agreement is essentially an expiration date. These provisions stipulate that either the entire agreement or certain terms automatically expire after a certain amount of time, or until a specific milestone is reached. For example, a couple may decide to include a sunset clause that automatically terminates the agreement after ten years of marriage. Like most other things in life, there are pros and cons associated with sunset clauses.

What are the Advantages of Sunset Clauses in Premarital Agreements?

Sunset clauses in premarital agreements have many advantages. The main ones are as follows:

• Adaptability: A sunset clause can acknowledge that circumstances may change over time and that enforcing the terms of the document may no longer be practical or truly reflect the financial reality of the couple.
• Fairness: A sunset clause can make the entire agreement more acceptable to a spouse who is a lower earner or does not have as many assets. A sunset clause can signal that the premarital agreement is not permanent but rather, is only meant to provide protection during the early years of a marriage, which are known to be higher-risk.
• Encourage open dialogue: Placing an expiration date on a premarital agreement can require couples to communicate about their finances and long-term goals at a later time. This can often lead to an updated agreement after the marriage has taken place, known as postnuptial agreements.

What are the Drawbacks of Sunset Clauses in Premarital Agreements?

While sunset clauses have many benefits, they also have some drawbacks. These include:

• Asset exposure: After the agreement expires, assets that were deemed as separate and therefore, protected, may convert automatically into marital property. This can have long-term tax implications and other financial consequences.
• Uncertainty: If the couple divorces after the premarital agreement has expired but before they have drafted a new agreement, it can leave them in a state of financial and legal confusion.
• Complicated renegotiations: Placing an expiration date on a premarital agreement can result in time-consuming and costly renegotiation of a new agreement.

Our Prenuptial Agreement Attorney in Tampa Bay Can Advise On Your Case

Premarital agreements are as unique as the couples that draft them and the provisions you include in yours will depend on your goals and needs. At Florida Law Advisers, P.A., our Tampa Bay prenuptial agreement attorney can advise on your agreement, help you identify your goals, and include the necessary provisions that will offer the protection you need. Call us today at 1 (800) 990-7763 or contact us online to schedule a consultation.

Source:

leg.state.fl.us/Statutes/index.cfm?App_mode=Display_Statute&URL=0000-0099/0061/Sections/0061.079.html