An inheritance can provide you with an enormous amount of financial stability. Yet, it can also complicate matters when you decide to get divorced. In most states, including ours, inheritances are considered separate property, meaning that the beneficiary of the inheritance owns it solely and it is therefore removed from the marital estate. This means that inheritances, generally speaking, are not looped into the property division process of divorce. But that isn’t always the case.
When inheritances become marital property
The most common way that inheritances end up being considered marital property is when they are commingled with marital funds. For example, if you inherited $50,000 and deposited it into a jointly held bank account that you and your spouse frequently draw from, then that $50,000 is probably going to be considered a marital asset and therefore subject to property division.
But money isn’t the only asset that can transform from separate property into marital property. Let’s look at a house as an example. If you inherit your parents’ home, then it’s separate property. But if you put your spouse’s name on the deed, allow your spouse to move into the home and help maintain it, or your spouse puts money into maintaining and fixing up the residence, then he or she will likely develop a legal interest in the property that he or she can seek to protect during the property division process.
Know how to deal with inheritances
The best way to protect an inheritance is to know what to do with it on the front end. However, even if it’s too late to protect your inheritance from becoming marital property, there may be legal strategies that you can develop to better ensure that you obtain a fair outcome from your divorce’s property division process. If you’d like to learn more about how to do that, then you may want to consider working with a skilled family law advocate.