Spouses who inherit assets must be careful when using them

On Behalf of | Dec 8, 2014 | Uncategorized

Illinois residents who inherit money or other assets while married need to be cognizant of what they do with this inheritance lest they lose it during a divorce. Inheritances received before or during a marriage are deemed to be separate property that can’t be touched during a divorce.

Such inheritances are not considered to be included in an equitable property division should the couple divorce because they are not deemed marital property. However, the scenario changes if the spouse who inherited the assets places them, say, in a joint bank account. This is considered “commingling.” If the money in the joint account is used for such things as joint household expenses or improvements to the family home, then the assets may be considered marital property and subject to property division in a divorce.

It can get even stickier if the inheriting spouse puts the assets in a joint account but then says they were never intended to be used jointly. The inheriting spouse must prove these assets are not joint assets, with a very high burden of proof required by the courts. It is therefore important for the inheriting spouse to keep the assets in a separate account if there is no intent to share them.

A prenuptial agreement can also serve as a property division agreement if one person inherited assets before the marriage or expects to inherit assets after the marriage and does not want them to become marital property. In this situation, the couple planning to wed may want to consult with separate family law attorneys who may be able to advise them on their rights and responsibilities toward their spouse-to-be and assist in drawing up a mutually satisfactory agreement.

Source: Findlaw, “Inheritance and Divorce“, December 02, 2014

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