Divorce and Inheritance

Is an Inheritance Considered Marital Property in a Virginia Divorce?

When one spouse has significantly more assets or income than the other, their divorce could be considerably more complicated than one between spouses on equal financial footing. Consider, for example, when one party receives an inheritance. Is it supposed to be divided between the spouses? How can it affect important divorce issues, like the division of assets and spousal support?

Having a strong legal team on your side can make navigating this time much easier. Let us help. Call Olmstead & Olmstead at 703-260-8752 to set up a consultation with our team now.

How Virginia Law Looks at Inheritances

Virginia, like most states, is an equitable distribution state. Shared or marital assets are divided in a way that is fair to both spouses. A variety of factors are taken into account, including both parties’ financial and non-financial contributions to the marriage, their earning capacities, separate assets, and standard of living during the marriage.

Inheritances, however, are not viewed as a marital asset in Virginia or most other states. The law looks at an inheritance as it looks at a gift to one spouse. It is considered to be the sole property of the spouse to whom it was given.

When Separate Property Turns into Marital Property

Of course, this isn’t always the case. There are situations where a separate asset—including an inheritance—can become marital property. This is called commingling, and it can complicate the division of assets by turning some separate assets into shared assets.

There are many ways this can happen. Consider a common example: Spouse A receives a sizable cash inheritance from a deceased family member. They opt to use it for family expenses and deposit it into the couple’s joint bank account. They both pull from that account to cover bills, groceries, family trips, and other expenses. When they finally divorce, Spouse A claims that the inheritance is solely theirs and should not be split. But because the inheritance is mixed with both parties’ income, tax refunds, and other joint assets, it is impossible to separate it out. It would then be split in an equitable manner.

Commingling can also happen if an inheritance is used to benefit both spouses equally. For example, the couple may use the inheritance to buy an investment property that becomes a main source of income for the family. They both contribute to the management and upkeep of the property, and marital funds go into its maintenance. In this scenario, the inheritance would likely be considered a marital asset.

Protecting Your Inheritance from Commingling

If you have received or are going to receive an inheritance, how can you protect it from commingling? You may keep the inheritance in a separate account that is only in your name. You should also avoid using it for joint expenses or family investments. Any assets purchased with the inheritance should only be in your name and should only be maintained with your money. Using marital money could cause it to become marital property. You may also look into a postnuptial agreement that ensures that the funds stay with you in the event of a divorce.

The Role of Inheritances in Spousal Support 

While an inheritance may be considered separate property, it can still affect child and spousal support. For example, if one spouse receives an inheritance and decides to live solely off of it, that does not get them off the hook for spousal support and child support. The court will likely still calculate what they owe each month based on their previous income or what they bring in from their inheritance. If one party would otherwise receive spousal support but receives a large inheritance, that could mean giving up alimony. Alimony is often awarded only to help the lower-earning party become self-sufficient; if their inheritance is enough to support them, there may be no need for alimony.

Prepare for Your Divorce with Olmstead & Olmstead

As you consider how you want to move forward with your Virginia divorce, make sure you have the team at Olmstead & Olmstead by your side. Fill out our online contact form or call us at 703-260-8752 to set up a time to talk with our family law team.

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