A cohabitation contract is an important document written up between two people who live together but who are not married, and it acts in much the same way as a prenuptial agreement. Cohabitation contracts typically list the financial responsibilities of each partner as well as deal with the allocation of properties owned before the time the contract was signed, and those obtained afterwards. These become crucial in the event that the partnership may end and when drawn up properly are legally binding to each party. The time to draw up a cohabitation contract depends upon the situation but is usually done when the two parties agree to share a home or have children since it has the added benefit of providing the couple access to certain tax incentives or other protection.
Usually a couple files for a cohabitation agreement when they have chosen to share a residence as well as the financial responsibilities that come with it. Not only does the agreement pertain to the rights of the home itself, but also what other financial charges may be required of each party in the event that the partnership dissolve. Since the couple isn’t married such issues might otherwise require an extended amount of legal discourse. If the terms are disputed such issues might be covered through marriage dissolution terms, a cohabitation agreement will act in the same however for a couple who chose to share their residence.
The proper time to write up the agreement would be at the time that a residence is shared, whether before living together or upon the onset. Since the agreements act in the same way as a marriage agreement they also offer deductions in certain types of taxes as well as qualifying the each party for property rights and privileges. Couples with a cohabitation agreement can save a great deal of money so as soon as the partnership is valid and both parties have agreed to move forward with it this type of agreement can become useful. These may include such things as employment insurance as well as other discounts on these types of expenses.
If there are children involved then there is no better time for a cohabitation agreement as these may be used to determine support and further responsibilities should the union dissolve. The agreement may also list the rights to the minor should one of the parents become deceased, as well as granting them estate rights. The agreement is essentially for those who are sharing their daily lives, perhaps including properties and assets, and is useful for any unmarried couple who are sharing residence or have chosen to have children. These agreements should be entered into before habitation or the attainment of property that is to be shared, including the financial responsibilities of shared property.