Divorce proceedings are often complex. The more property a party has, the more attention must be given to how it is divided. However, when a party has an inheritance they wish to retain, the question may arise in the divorce as to whether that inheritance can be divided.
Inheritances, whether they are real property, items of value, or financial benefits, can also be of important emotional value.
Here are some important facts to consider regarding a party’s inheritance in the midst of a divorce proceeding.
Washington is considered a community property state. This means that courts consider all assets acquired during the course of the marriage to belong to both parties. The assets between both parties get divided in such a way that both individuals can maintain a semblance of the lifestyle they experienced during the marriage.
When it comes to an inheritance, that is usually considered a separate asset and cannot be considered when the division of assets occurs. There are certain circumstances in which inheritances can be considered divisible which will be covered further down.
Washington statute RCW 26.16.010 states the following regarding inheritance and division:
Property and pecuniary rights owned by a spouse before marriage and that acquired by him or her afterwards by gift, bequest, devise, descent, or inheritance, with the rents, issues and profits thereof, shall not be subject to the debts or contracts of his or her spouse… (emphasis added)
In Washington, if you take the proper steps and carefully manage your inheritance, you will likely keep it.
As with most things in the legal world, there are exceptions to the rule. Due to the liquidity and transferability of money, there are ways that your inheritance can become divided.
For example, if you receive a large sum of money as an inheritance, and use it as a down payment for your home, that can be divided between parties. The inheritance money in this scenario was transferred into equity on a property, and if that property was enjoyed by both parties during the marriage, it is then liable to be divided.
Additionally, if you create joint accounts and put inheritance money in, that account may be liable for division. Other forms of inheritance like valuable art, cars, or other items can also potentially be involved in division.
If a judge is attempting to maintain balance and, as previously mentioned, allow both parties to maintain a semblance of their previous lifestyle, some inheritances may be divided.
In order to protect your inheritance, it is critical that none of the assets commingle with your spouse’s assets. You must set up clear boundaries between the inherited assets and any other assets in the marriage, and be sure to avoid spending your inheritance on mutually shared property like cars, houses, or luxury items.
If you would like to take additional steps to ensure your inheritance remains safe and protected, contact Molly Kenny.