Is Your Inheritance at Risk in Divorce?
Orange County attorney counsels clients on protecting wealth
Married persons must be careful about how they treat inherited wealth, especially if they want to prevent that inheritance from being divided in a divorce. Under New York’s law of equitable distribution, a legacy from a beloved relative may have to be surrendered in part to your ex-spouse unless you keep it separate from your marital finances. At Meth Law Offices, PC in Chester, I advise clients on the best ways of protecting an inheritance from divorce in New York. With advance planning, you can help ensure that a bequest remains yours even if you dissolve your marriage in the future.
How to keep inherited assets separate from marital assets
Under New York law, an inheritance received by either spouse during a marriage is separate property, provided the recipient does not treat it as marital property. Commingling the inheritance — treating it as part of your joint finances — can create a right in the property that allows your spouse to claim it should be subject to equitable distribution. As a divorce lawyer in Orange County, NY, I can advise you about how to shield your inheritance from division in a divorce.
Steps to protect an inheritance from divorce
By the time a divorce is in motion, your options are limited. Prior planning can make all the divorce to your property rights during your divorce.
Steps you can take to keep inherited assets separate include:
- Documenting that the inheritance is for you alone
- Creating separate accounts to hold inherited assets
- Setting up a trust to hold assets
- Executing a prenuptial or postnuptial agreement
- Limiting your spouse’s access to and use of the asset
The best time to start thinking about protecting an inheritance is before it’s in your possession. For example, if you know that you will inherit real estate from your parents, you can talk to them about how they plan to transfer the property and make sure the bequest is in your name only.
Can you protect inherited assets if they have already been received?
If you received an inheritance in the past and are now wondering how to protect it, keep in mind that any property left to you prior to marriage is yours alone.
If you received a bequest during marriage, you can take actions to treat it as separate property. Place the funds in an account in your name, rather than in one jointly held with your spouse. If part of the inheritance has been used for joint expenses, gather receipts and other records to account for them as your personal contributions to the household. Continue to keep a careful accounting going forward.
Using a trust to protect an inheritance
One way to guard against commingling an inheritance is to establish a trust. When you place assets into a trust that you alone control, you make clear your intention to treat them as separate property and you give the trustee sole power to manage and distribute them.
To learn more, contact a Chester, New York divorce lawyer for a free initial consultation
Meth Law Offices, PC helps clients protect inherited assets during divorce. I serve clients in Chester and throughout Orange County. Please call 845-469-9529or contact me online for a free initial consultation.