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Do I have to give up my inheritance during divorce?

Families use inheritances to pass down more than just money -- for many it is about continuing a legacy or ensuring that important financial assets remain within the family. However, divorce can throw a person's inheritance into question. While most people in Iowa might assume that their inheritance is strictly personal property and safe from the asset division process, this is not necessarily always the case.

If received before the marriage and, in the case of money, kept separate from marital assets, inheritances are normally still considered personal property. It is also still separate property when an inheritance is passed on to a person who is married, and done so without any mention of the spouse. In the second situation, however, an heir should take precautions to ensure that he or she does not handle the inheritance in a manner that makes it become marital property.

One of the most common ways for an heir's inheritance to become marital property is for it to be commingled. This usually occurs when inherited money is placed into a joint account shared by both spouses, and then used for marital expenses. Money does not necessary have to be commingled in a bank account to become marital property. Using an inheritance to make improvements to shared assets -- such as a home or vehicle -- can also have the same result.

It is up to each individual heir to decide how he or she wants to use an inheritance. For many in Iowa, inheritances hold significant emotional value from deceased loved ones, and it is understandable that they might want to protect these assets during a divorce. In order to full protect one's inherited interests and assets, it is important to understand the difference between separate property, marital property and how these two will be divided during a divorce.

Source: FindLaw, "Inheritance and Divorce", Accessed on Oct. 30, 2017

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