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Can an inheritance be divided in a divorce?

Receiving an inheritance can be a form of passing on a family legacy for some in New York. However, there may be concerns as to what will happen to that inheritance if a couple decides to divorce. For some, protecting their inheritance from an ex-spouse may be of particular importance.

Whether an asset can be divided between a divorcing couple depends largely on what kind of asset it is. Generally, marital property can be split while separate property stays with its original owner. However, it is possible for assets that were previously considered separate to change status and later become the property of both individuals.

For instance, inheritance is usually considered separate property, which would incline most to believe that an inheritance would automatically default to the bequeathed. However, if an inheritance is added to otherwise joint assets, such as a bank account or a purchase for the marriage, then it is no longer a separate asset. This subjects it to be divided during a settlement.

As New York is an equitable distribution state, each party is considered entitled to a fair portion of the marital assets, although this does not necessarily mean that each party receives half. If an inheritance has been commingled with any marital assets, then it may be subjected to being divided among both spouses. While maintaining an inheritance in a separate account from any joint accounts with a spouse can protect an inheritance from going to an ex-spouse, by the time a couple decides to divorce, it may be too late to make this decision. While, in many instances, mutual negotiation or even a third-party mediator can result in a divorce settlement that mutually favors both parties, when issues such as an inheritance present a stumbling block, further action may be required. When both prior options fail, going before a judge for divorce litigation can ultimately provide an agreeable settlement, and it also puts the final decision for all disagreements in the judge’s hands.

Source: Forbes, "Divorcing Women: Here's How to Protect Your Inheritances And Gifts", Jeff Landers, Aug. 19, 2014

Source: Forbes, "Divorcing Women: Here's How to Protect Your Inheritances And Gifts", Jeff Landers, Aug. 19, 2014

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