If you’re facing a divorce, you may not realize that you may not automatically be entitled to keep things you personally inherited. Property obtained, earned, or received during marriage is considered community property. There is an exception for separate property and inherited items fall into that category, but only if they are not converted into community property. If you inherited money from your grandmother and put it in a joint bank account with your spouse, that property may have become community property when you put it in the account. If you inherited a vacation home from your aunt and you put your spouse on the deed or if your spouse assisted in upkeep, improvements, or helped pay a loan you took out against the property, it may have been converted to community property.
To protect your inheritance from divorce:
– Have a prenuptial or post-marital (created after the wedding, but serving the same purpose as a prenup) agreement created that protects inherited property.
– Keep proof. Wills, gift tax returns, and other documentation showing something was intended as a separate inheritance can help prove your case.
– Keep assets as separate as possible during marriage so there is no commingling.
– Create a living trust, placing your inherited assets into the trust, thus keeping them out of the marital pot. You can control and use the assets during your life, but they are passed on to your beneficiaries after your death and there is no question about ownership.
– Keep titles and deeds in separate names after they are inherited to prevent claims by your spouse.
– Discuss all inherited property with your attorney when you begin to discuss your divorce.
The Sampair Group provides confidential and compassionate assistance with your divorce or family law case. We serve clients in Glendale, Mesa, and Phoenix, Arizona. Schedule an appointment today.