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Inherited Property: Is Your Inheritance Subject to Division in Divorce?

inheritance money property Illinois lawWhen a couple decides to pursue a divorce, they must, at some point, determine how to divide the marital estate between them. If they are not able to reach an agreement regarding the identification and allocation of marital property, the court will be required to do so in accordance with Illinois law. The first step in the process is determining which assets and debts are included in the marital estate. For the most part, this step is fairly straightforward, as most of the property acquired by either spouse during the marriage is marital property. Inherited property, however, generally represents a significant exception, depending upon how it was held and handled throughout the marriage.

Your Inheritance Under Law

The Illinois Marriage and Dissolution of Marriage Act provides that property received through “gift, legacy, or descent”—in other words, your inheritance—is not considered to be marital property. Therefore, inherited assets are not usually subject to division during a divorce. There are a few significant exceptions, though, and it is important to understand how the applicable law works.

Commingled Property

Upon receiving your inheritance, for example, you may decide that you wish to use it for the benefit of the marriage and your family. With that in mind, you deposit your inheritance into a jointly-held account for you and your spouse to use to pay bills, improve your home, and take family vacations, with little or no accounting for what specific money was the inheritance and what was your regular income. Using your inheritance in this way will cause the asset to lose its identity as inherited, non-marital property, and will most likely be seen as a gift to the marital estate. You may recieve additional consideration for your contribution to the marital estate, but your inheritance is not likely to be fully reimbursed.

Other Considerations

There is another, very important way that your inheritance can affect property division, even if the inherited property is fully protected as non-marital property. The allocation of marital property is based on the principle of equitable distribution, which means that the court is required to figure out a division that is fair, not necessarily equal. To do so, the court must look at a large number of factors regarding the marriage and the circumstances of each spouse, including available financial resources and assets. If you recently received a substantial inheritance, of which your spouse will get nothing, he or she may be likely to receive a larger portion of the marital estate. Similarly, your inheritance may also play a role in the amount of spousal maintenance you will be required to pay, in the event that such payments are deemed necessary.

If you have recently received an inheritance and would like to learn more about protecting your property in divorce, contact an experienced Kane County divorce lawyer. We will review your situation and help you explore your available options. Call 630-377-7770 to schedule a free consultation at Bochte, Kuzniar & Navigato, P.C., today.

 

Source:

http://www.ilga.gov/legislation/ilcs/ilcs4.asp?DocName=075000050HPt%2E+V&ActID=2086&ChapterID=0&SeqStart=6100000&SeqEnd=8350000

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