Is your inheritance separate property?

You certainly think of your inheritance as property that your spouse does not own. When your parents passed away, they left it to you directly and it was in your name only. You clearly have the option to share it with your spouse if you want, but it belongs to you.

But what if you get divorced? Will the court share your view that this is separate property that should stay with you, or are they going to say you have to divide it with your spouse?

Did you already share the funds?

As a general rule, separate property includes an inheritance. This means that it usually won’t have to be divided between you and your spouse. Your gut feeling that this is a financial asset that belongs only to you is correct, and the court will usually share that perspective.

However, if you already decided to let your spouse use some of that money, then you may have commingled it. This can turn it into a marital asset that you then have to divide.

A common example of this is when people use part of an inheritance to buy something they both own, such as a first home. If you used your inheritance as a down payment, it now becomes marital property. If you let your spouse access the bank account where you kept that inheritance, that can also commingle it.

Essentially, as long as you kept the inheritance to yourself the entire time, it stays with you. But if you gave it to your spouse or shared it with them, then you would also have to share it when you get divorced. You can see how complicated a situation like this could be and why it’s so important to understand your rights.

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