During your marriage, you received a significant inheritance from your late uncle, who in many ways was like a second father to you. The regular phone calls and texts, the annual visits you and the fun-filled activities and discussions led to a lifetime connection. After he died, he passed on part of his financial legacy to you for which you remain grateful.
But now that divorce looms, many things swirl through your head. One of them is the question, “What happens to the inheritance in the divorce proceedings?” You want to protect it. It belongs to you and came from a truly valued loved one. You have major concerns, especially now that the divorce has brought out the worst in your estranged spouse who insists he deserves half of that inheritance and plans to fight you tooth and nail in court.
Non-marital property includes inheritances, but …
Typically, when dealing with asset division in divorce, property is either marital property or non-marital property. Marital property are assets that the couple accumulated during the marriage. Non-marital or separate property includes many things, including inheritances, gifts given by third parties to a spouse as well as property that a spouse owned before the marriage or property secured after the initial separation.
Texas clearly defines its inheritance laws. An inheritance received by one spouse during the marriage is not automatically considered community property. If you have received an inheritance, it is important to invest or place these assets in a separate personal account; one that has your name exclusively on it. This may include bank, money market, mutual fund and investment accounts.
A problem that surfaces, though, is if the inheritance (or any gift for that matter) is commingled or combined into a joint account that includes the names of both spouses. By doing this, personal property rights can be voided, transforming such assets into community property. Also, if that money in a joint account serves as the funds for making a purchase in both spouse’s names, that property, too, is community property.
Protecting your inheritance is important. With the right steps made, you can do so. Remember to place it into a personal account.