An inheritance can be one of the more difficult things to divide during a divorce case. For one thing, it may be a very substantial financial asset, and it could be worth as much as anything else that the family owns. For another thing, it’s a problematic asset because the person to whom that inheritance was given likely believes that their parents would want them to have it exclusively. They wouldn’t want that money to go to an ex.
And, in many cases, this is exactly how the courts address it. And inheritance can be considered a separate asset that is only owned by the spouse to whom it was given. The other spouse may not have any claim to it, so it doesn’t have to be divided.
But there is one key way that this definition is circumvented, and it’s known as commingling.
Mixing your inheritance
Perhaps the easiest way to think of commingling is just to think of it as mixing your inheritance. You have a bank account or an investment portfolio that has money you and your spouse have invested or saved personally. If you put the inheritance in that same account, this mixes the money together and makes it indiscernible. Both people may have a claim to this account, even though some of the money was from the inheritance.
Another example is if you use the money to buy an asset. Maybe you took the inheritance and you and your spouse bought a home together. If you’re both on the title, that home is owned by both of you and you can’t claim that it is yours just because it was your inheritance money. The home is subjected to property division like other assets that you own together.
Then how can you protect it?
The best way to protect an inheritance is just to keep it separate at all times. If your situation becomes complicated and you’re worried about losing assets in a divorce, be sure you know what legal options you have.