Are Monies I Inherit During My Marriage Separate Property?
During the course of a marriage one or both spouses may inherit money. This leads to the question of whether, by virtue of being married, the inherited money is separate property or marital property. Which then begs the question of whether your spouse is entitled to a portion of your inheritance as a part of the equitable distribution of the marital assets.
Generally, inheritances are separate property and are not subject to equitable distribution. However, there are exceptions when inherited monies are considered to be marital property. The two most common ways in which inheritances are converted from separate property to marital property is when the inheritance is deposited into a joint account for a significant period of time and when the money remains in a separate account but marital monies are also deposited into the same account. By depositing the inheritance into a joint account or adding marital monies to the inheritance changes the nature of the inheritance from separate to marital property. Once an asset becomes marital property, it is subject to equitable distribution during a divorce.
If the inheritance is commingled for a very brief period, it may still retain its identity as separate property. However, the best way to assure that your inheritance remains your separate property is to deposit the monies into a separate account titled solely in your name and do not deposit any marital monies into the same account. Another way to ensure that your inheritance remains exclusively yours is to enter into a post-nuptial agreement. A post-nuptial agreement can be entered into even if you are not considering divorce at the time you received your inheritance. A post-nuptial agreement will allow you to clearly define that your inheritance received during the marriage shall remain exclusively yours in the event of a divorce. It is also a good idea to make sure you keep records relating to any inheritances you may receive. These records include banking statements, a copy of the will under which you received the inheritance, and copies of any checks for the inherited monies received. It is important that these records are kept in a safe, secure location because in the event of a divorce, you will need to prove that the inherited monies are your separate property.