Probably one of the most contentious parts of a divorce is dividing a couple’s assets. No matter how amicable a divorce may start out, when it comes time to decide who gets what, things can take a turn for the worse. In New Jersey, inheritances are protected by law — but only if you take the proper steps to keep an inheritance completely separate from joint marital assets.
Inheritance prior to marriage
If you inherit money or property before you are married, you can maintain sole possession of your inheritance even after the marriage ends if you ensure that your inherited assets are never shared with your spouse. If any portion of the money you inherited is deposited into a joint bank account or if any of your marital funds are added to your inheritance account, those funds are considered to be comingled and thus subject to division in a divorce.
Inheritance during marriage
Inheriting money or property during a marriage does not entitle your spouse to any share of your inheritance in a divorce if your inheritance was kept totally separate from marital assets. You must not use any inherited funds to benefit marital assets — for example, using inherited money to pay your mortgage or make improvements to your home — or your inheritance will be considered comingled and subject to the laws of distribution in a divorce.
Inheritance of property
The best way to protect inherited property from becoming a joint marital asset is to only use your own non-marital funds to maintain it. You should not have your spouse make any improvements to the inherited property, as that could be considered a “sweat equity” investment in your inheritance and your soon-to-be ex could be compensated for that in a divorce.
In addition, you must be careful to avoid transmutation, which is a more subtle form of comingling. An example of transmutation is if you use marital funds to pay a contractor to perform work on your inherited property. If transmutation can be proven, your ex stands a good chance of making a claim on your inherited property during a divorce.
At Cistaro Law, we are not only concerned with your divorce today, but also with your quality of life long after your case is over. Your family law issues deserve to be managed with dignity and respect. You can prepare to civilly resolve your divorce, heal, and move on with your life with a legal team that has helped individuals all over New Jersey to heal and prosper. Contact us today for your free consultation.