Losing a close member of your family can be difficult, but often they leave something behind as an ode to their time in your life. The gift can be very personal, and the last thing you want is to lose any bit of it in a divorce
Inheritance can be a complicated process that is rooted in strong emotional ties. When considering divorce, you don’t want to part with what is rightfully yours, and you may not have to if your inheritance qualifies as separate property.
Eyes on the beholder
In the event of a divorce with no agreement in place, New York is an equitable distribution state. The court has the final say on an equal division of assets, but this division only pertains to marital property. Separate property, like a qualifying inheritance, marks you as the sole owner in the eyes of the court.
- Agree to disagree: A court can consider a written agreement signed before the marriage that spells out separate assets. If your partner agreed to set aside your inheritance ahead of time, that saves you the trouble of defending your sole ownership. However, a judge does have the authority to decide your arrangement is unfair, and then the court can ignore your accord.
- Divorcing assets: An apparent division from marital holdings will go a long way to proving the inheritance is yours alone. Any money or property that gets mixed with shared assets can hang on to a commingled tag, even if separated later.
- Promises of profit: You can also be entitled to any profit or dividends that come with your inherited property. If you can show the principle is separate, any separate off-shoots could stay yours after the divorce. But be careful, even an act as benevolent as using the money earned from investments to support the household is enough for the court to interpret something as a shared investment.
- Mixed and muddied: And there are other ways the court can award your partner a piece of your inheritance. Your spouse can look for a claim through assistance, and that doesn’t have to mean financially. Using your partner’s skills, time or influence in any way can be a quick road to a shared asset.
Have your finances organized and be ready to show a full picture of your sole stewardship. Preparation can make sure you retain full ownership of the gift that means so much to you.