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What happens with an inheritance during divorce proceedings?

| Mar 30, 2021 | Division of Assets |

Sadly, your mother died, representing another difficult personal and emotional issue. The timing was not good, but life happens. The other issue you have dealt with for the past year has been your rocky marriage. You kept this news from your mother while she was in hospice care. And you tried to salvage the marriage through a series of counseling sessions, but to no avail.

The death of your mother and disintegration of your marriage intersected. Each of them represents potentially traumatic and devastating news. If there is any “good” news in this matter, it is that you shall receive a sizable inheritance from your mother. But now a major question surfaces: What becomes of your inheritance during divorce proceedings? You wish to protect it, and you can.

Protect it, but avoid combining in a joint account

Inheritances are non-marital assets when these assets are received by a spouse separately from the other spouse. In such a scenario, only the receiver of an inheritance holds claim to them. As long as such assets are held only in the name of the receiver or beneficiary, generally, the other spouse has no claim to any share of that inheritance.

When receiving an inheritance, you can protect its legacy and what belongs to you by placing or investing it in a separate account, which only has your name on it. Options may include mutual funds, IRAs, money markets and bank accounts.

However, difficulties arise if your inheritance is commingled or combined in joint accounts with the names of both spouses on them. At the snap of a finger, your non-marital property transforms into marital property. In these situations, your estranged spouse has a legal claim on these assets.

The inheritance from your loving mother came after her years of saving, investing and, sometimes, toiling at work. You want to protect that inheritance while going through a divorce, so consider the options that allow you to do so. You will be grateful for doing so.