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Is inheritance money protected in a divorce?

If you are married and receive an inheritance with no mention of your spouse in the deceased's estate or will, you may wonder whether he or she is entitled to any of the inheritance money. The answer is not simple, and depends on a few factors.

Since inheritances are not considered marital property, monies collected through an inheritance are generally not subjected to an equitable distribution in the event of a divorce. It does depend, however, on how the money is received.

If the money is used for home improvements or is deposited into a joint bank account or used for mutual expenses, it may be considered a commingling of the inheritance, and may lose its immunity, as it is now "shared" with your spouse.

Although it varies by state, the same is generally applicable to inheritance received before a marriage. If the money has been put into a joint account for joint spending, it is considered commingled. Otherwise, money received before a marriage is considered separate property, as the money was never intended to be shared.

If you want to keep your inheritance as separate property, there are a few things you may do. If you are not yet married, consider a prenuptial agreement with your soon-to-be spouse. This will enable you to set rules regarding all your financial matters and marital property in advance. If you are currently married, it may be wise to speak with a family law firm to learn your state's laws and see if you can keep the inheritance as separate property opposed to it being considered commingled property and subject to equitable distribution in the event of a divorce.

Source: findlaw.com, "Inheritance and Divorce," Accessed on Aug.1, 2015

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Joseph J. Porzenski
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