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Standing Strong for Your Rights

Do you have to split an inheritance in divorce?

On Behalf of | Jan 10, 2024 | Divorce

Many people have a significant inheritance, perhaps that they view as their retirement fund. After all, we are in the midst of the biggest wealth transfer in history. Trillions of dollars are getting passed down from the Baby Boomer generation.

But if your parents gave you an inheritance and now you are getting a divorce, you may be worried that the inheritance is a marital asset. This would mean that you have to split it with your ex. But you know that your parents clearly meant for that money to stay in the family. Do you have to divide it during the divorce?

It starts as separate property

As a general rule, an inheritance will begin as separate property, meaning that you are the only person who owns it. Even if you get the inheritance while you are married, it is your personal property and you don’t have to share it or divide it.

However, this status can change. People will often commingle or combine their inheritance, which means mixing it in with other funds or using it for shared purchases – storing it in a shared bank account, using it to buy a home, etc. If you did this, rather than keeping the inheritance in a separate bank account that only you can access, then your spouse may deserve a portion of that inheritance in the divorce.

What this means is that an inheritance can be quite complicated. Maybe you believe you always kept it separate and you should retain 100% of the value, but your spouse claims they were also allowed to use the money and they should get 50%. As you work your way through such a complex situation, be sure you understand all of your legal options.