Will an Inheritance Be Considered Marital Property?

Any asset that you, your spouse, or both of you together acquire during the years of your marriage is considered marital property, which must be divided between the two of you equitably – or fairly – upon divorce. It likely comes as no surprise that the division of marital property has the potential to be one of the more challenging divorce terms. If you are facing a divorce that involves an inheritance, don’t wait to discuss your unique claim with an experienced Illinois property division attorney.  

Inheritances

Inheritances that are in one spouse’s name alone are the separate property of that spouse, which is one of the few exceptions to the rules of property division in an Illinois divorce. When both spouses inherit together, however, the inheritance becomes part of the marital estate. Even inheritances received by only one spouse can lose their separate status in certain situations, which makes proceeding with caution well advised.

When Inheritances Lose Their Separate Status

As mentioned, inheritances are generally the separate asset of the spouse who inherits, but the separate nature of an inheritance can be lost in specific situations. For example, if you inherit money that you turn around and deposit in your joint account, the commingling of marital and separate assets can void the separate nature of your inheritance. 

Using inherited assets for the benefit of you and your spouse as a couple can have a similar effect. For example, if you use your inheritance to make your mortgage payments, the amount that you put toward your mortgage or other household bills will very likely lose its status as a separate asset.  

When an Inheritance Increases in Value

Even if you carefully keep your inheritance separate from your marital assets and ensure that there’s no commingling going on, part of your inheritance could still qualify as marital property in certain situations. While any increase in the inheritance’s value over the years of your marriage should retain its separate nature, the same is not true if marital assets were used to increase the inheritance’s value. Consider the following examples

• You used marital assets to increase the property’s square footage, which – in turn – increased its value.
• Your spouse made improvements on the property that increased its value via sweat equity.
• You used marital assets to maintain the property, which contributed to it holding its value over time.

Inheritances can complicate the division of marital property, and working closely with a well-established property division attorney is always in your best interest. 

Discuss Your Case with an Experienced Illinois Property Division Attorney Today

The division of marital property has the potential to become an especially contentious divorce term, and an inheritance can intensify things. The insightful Chicago property division attorneys at Arami Law, Inc. are well-versed in the intricacies of property division and are committed to skillfully advocating for your financial rights throughout the divorce process. Your case is important, so please don’t put off reaching out and contacting us for more information about what we can do to help you today.