One of the more complex issues that may arise in a divorce is whether one party’s inheritance should be considered marital property. One spouse may receive an inheritance during, or even prior to, the marriage and later wonder, “is my inheritance subject to equitable distribution in a divorce?”
Generally, inheritances are not subject to equitable distribution because by law in Pennsylvania, inheritances are not considered marital property. Instead, inheritances are treated as separate property belonging to the recipient, and therefore may not be divided by the parties in a divorce. While the general rule is that separate property is not subject to equitable distribution, inheritances may change in status during a marriage and may become part of the marital estate. For example, if one party deposits their inheritance into a joint bank account titled in both parties’ names, the inheritance becomes “commingled” and therefore changes status to marital property. If one party inherits property titled in his/her name alone, but later adds a spouse to the title of that property, the property changes from separate to marital property. Important to note is that even if an inherited asset is immune from equitable distribution, the increase in value of the inheritance from the date of the parties’ marriage to the date of separation will be included in the marital estate. Furthermore, income generated from inherited assets is fair game for purposes of support.
The best way to ensure that inherited property remains separate, not subject to equitable distribution, is very simple: keep it separate! This means any funds received as an inheritance must be kept in a separate account, titled in your name alone, not containing any marital funds.
If you receive an inheritance or gift and are concerned with keeping it separate property, you might consider discussing the issue with an experienced Bucks County divorce attorney. Call us at 215-340-2207, or email firstname.lastname@example.org.