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Do you need to divide an inheritance during a divorce? 

On Behalf of | Jun 5, 2024 | Family Law |

Five years ago, your parents passed away and left you a major inheritance. You were already married and had children at this time, and perhaps your children also got their own inheritance. Your plan has always been to use the money to retire, appreciating that it gives you a level of financial stability you would not have otherwise.

However, your spouse has recently asked for a divorce. You assumed the two of you would use the inheritance to retire together, and so did your spouse. They are now claiming that you need to split the inheritance with them, along with other marital assets. But you feel that the inheritance was a gift from your parents to you directly, so you should get to keep the whole thing. Who is correct?

Did you commingle the inheritance?

It likely depends on how you stored the inheritance after you received it. 

You may have kept it separate, such as putting it in a bank account under your name and not spending it on anything. An inheritance typically qualifies as a separate asset when you receive it, and it can keep this status if you keep it separate. That means you would get to keep the entire gift and you would not have to split it with your ex. 

But commingling the inheritance means using it to buy marital assets or mixing it with other marital funds. For example, if the inheritance was stored in an account that both you and your spouse could access, and you both used it from time to time, then they may have a valid claim that you already shared the inheritance with them. That makes it a marital asset, meaning the remaining balance has to be split up in the divorce.

You can see how complex this type of situation could become, so be sure you understand all of your legal options.

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