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A commingled inheritance may be at risk

by | Sep 20, 2017 | Divorce

Your spouse has asked for a divorce, and he or she is trying to fight for half of your inheritance, which you’ve already been given. Is it protected, or can you lose it?

Generally, an inheritance is safe, especially if you got it before you tied the knot. However, there is one way you could put it at risk: when it’s already been commingled with other funds.

Commingling is the process of mixing individual assets into your other assets. This gives your spouse equal access to it and then your spouse may be able to claim a portion of it when those assets are divided.

For example, perhaps you got the money a year before the marriage. You were already dating and making plans for your life together. Your spouse didn’t have much in the way of assets, so you figured you’d use the inheritance to help out.

Rather than keeping it in its own bank account, under your name, you just put it into your new joint bank account two days after the wedding. You used it to pay the last few months of rent on your apartment, and then you used about 10 percent of it for a down payment on a house. You paid off the first few mortgage payments with it while your spouse looked for a new job close to the new home.

While you may still have the majority of the money, it’s now been commingled with your other assets. You allowed your spouse to use it and it can be harder to show that you alone have a right to it during the divorce.

Asset division can be complicated. If you’re at risk of losing something you consider yours alone, make sure you know your legal options.

Source: Forbes, “Divorcing Women: Here’s How to Protect Your Inheritances And Gifts,” Jeff Landers, accessed Sep. 20, 2017