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Keeping inheritances separate in case of divorce

Spouses who anticipates receiving an inheritance while married in Nevada may need to understand the rules for how inherited assets are treated if a marriage ends. When one person inherits money or property that is specifically left to him or her and not a spouse that person’s partner could still claim a share in the event of a divorce under certain circumstances.

However, it is possible to walk away from a marriage with an inheritance intact. How heirs use their funds while married determines whether their spouse has a chance of receiving a share. Although state laws vary on this issue, the general principle is usually that if inherited funds are kept separate, such as in a bank account not shared with a spouse, and money is not otherwise comingled, then it is considered separate property. An example of comingling would include depositing some or all of the inherited funds into a joint bank account.

Using inherited funds for services like home improvements to a marital home could also void immunity from asset distribution in a divorce. Any assets seen as marital property are subject to equitable distribution. Even assets brought into a marriage might be subject to division in certain situations. Properties acquired before a marriage should be treated with the same precautions to avoid comingling.

People who have already comingled funds might still retain some or all of their inheritance. An attorney might be able to assist in proving that the funds were not intended to be shared. In addition, consulting an attorney might also be useful before getting married. Creating a prenuptial agreement could help protect assets one is bringing into a marriage. These agreements even include an inheritance that has not yet been received.

Source: Findlaw, “Inheritance and Divorce“, December 12, 2014

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