One of the most crucial and complex steps of divorce is the division of assets. A common concern that can arise is whether one spouse has any claims to the other spouse’s inheritance. Below, we discuss how these issues are often addressed and ways that you can help protect your rights to your full inheritance during a divorce.
Inheritance as Marital Property or Separate Property
New York is an equitable division state. This means that divorce courts are required to divide marital property in a way that is equitable and fair for both parties. This may not necessarily mean a 50/50 split between all assets; instead, many courts decide what is fair by looking at what each spouse contributed to the marriage and what each will need once they separate.
Judges will only look at marital property during asset division, which generally is all property that is acquired during the course of the marriage, regardless of what the title says or whose name is on it. So, is one spouse’s inheritance subject to such division?
Under the state’s equitable division laws, inheritance is treated the same way as assets that are owned before the marriage. It does not matter whether the inheritance was passed down to the individual before or during the course of the marriage; it is generally considered separate property and is immune from asset division.
How to Protect Your Inheritance During a Divorce
In order to ensure that your inheritance is protected during a divorce, you must prove to the court that it is separate property. If you are the heir, here are some ways that you can safeguard your inheritance and preserve the evidence you need:
- Sign Prenuptial and Postnuptial Agreements. Formally declaring on legal agreements that you intend to keep your inheritance separate can strengthen your case.
- Preserve Documentation. Document whether the inheritance was passed down solely to you (versus jointly with your spouse), and document all transactions made with it.
- Do Not Commingle Your Inheritance. For instance, if you inherit a house in need of a renovation that your spouse helps repair, then the spouse is entitled to an equitable distribution portion (half the value of the marital increase of the separate property) based on his contribution to the improvement.
- Maintain Separate Accounts. Whatever form the inheritance comes in (cash, stocks, or property), ensure that it is kept only in your name and not your spouse’s name.
- Establish a Trust. A trust can hold assets like inheritance and adds an extra layer of protection against commingling.
Ultimately, having a skilled, experienced family law team to stand in your corner during the divorce process can be the difference between protecting your inheritance and unfairly losing a portion of what is yours.
At Wisselman, Harounian & Associates, our attorneys have been assisting individuals and families on Long Island and throughout the state of New York for over 40 years. We are committed to helping you get through life’s most challenging and stressful times together.
Please don’t hesitate to contact our firm at (516) 773-8300 to schedule your no-fee, no-obligation consultation. We are more than happy to work around your schedule to ensure you speak with an attorney as soon as possible.