If you are planning on filing for divorce in the near future, you might be wondering how and if your inheritance(s) will be affected. Fortunately, New York’s equitable distribution laws treat inheritances as separate property, for the most part. Inheritances designated for one spouse are usually considered separate property and therefore not subject to division in court during a divorce proceeding. However, you will need to prove that your inheritance is considered separate property.
Can an Inheritance Be Considered Marital Property in New York?
As an equitable distribution state, New York law only allows marital property to be divided during a divorce. Marital property includes all assets, property, and income acquired during the marriage, regardless of who earned them. Separate property, or property acquired before the marriage, is not subject to equitable distribution laws.
Separate property includes inheritances that were received during the marriage.Therefore, an inheritance is considered separate property and not subject to division in a divorce if this inheritance was kept separate.
How Do You Keep an Inheritance Separate?
To keep an inheritance separate, you will need to avoid commingling your marital assets with your inheritance. For example, if you deposit an inheritance into a joint bank account, your inheritance may now be considered marital property. While it may seem okay to do this at the beginning of your marriage, it could have consequences later in the event you do decide to get divorced.
If you are planning on getting a divorce and expect to receive an inheritance during the divorce process itself, keep your money separate from your marital assets. Avoid placing the funds into a joint checking account or using them to pay for marital property such as your mortgage. Instead, deposit the inheritance into a separate bank account that is just yours. Also, to prevent future complications, do not pay off marital debts with any funds from this inheritance.
Here are some ways you can preserve your inheritance(s) in a divorce:
Establish a prenuptial or postnuptial agreement
You can create a valid agreement that clearly defines that inheritances will be considered separate property in the event of a divorce.
Keep proof of separate assets and funds
To maintain your inheritance(s) keep records of all assets, property, and bank statements that can prove your inheritance is separate property.
Maintain separate accounts
Do not deposit your inheritance into a joint account. Keep a separate account for this use.
If you are trying to keep your inheritance(s) secure in a divorce, our Long Island divorce specialists can help. Schedule a consultation by completing a contact us form onlineor calling us at (516) 688-0088.