Can I Lose My Inheritance in a California Divorce?

hand holding fan of hundred dollar bills

When you divorce, you’ll quickly discover that you have many considerations to make regarding the process of legally ending your marriage. Many worry about whether or not they will lose their inheritance when dividing property among spouses. It’s essential to connect with a Los Angeles high net worth divorce attorney if you have a considerable number of inherited assets that could be at risk during your divorce. The following blog explores what you must know about how California handles property distribution and whether or not your inheritance could be divided.

Am I At Risk to Lose My Inheritance in a Divorced?

When getting a divorce, understanding how California divides property when a couple gets divorced is crucial. California is one of few states that adhere to community property laws. Essentially, this means that each spouse is entitled to an even split of assets. However, only certain assets are subject to this division.

Community property laws only apply to marital assets, which are any asset obtained after the marriage or that has been co-mingled with other marital property. For example, you may find that if you have a retirement account with $10,000 before your marriage and accumulate an additional $30,000 throughout your marriage, your spouse would receive half of the $30,000. The initial amount in your retirement account is considered separate property.

Separate property is anything obtained before or after the marriage. However, certain elements acquired during your marriage under specific circumstances can be deemed separate property.

As such, you may wonder whether or not your inheritance will be at risk if you receive it during your marriage. So long as you keep your inheritance, gifted solely to you, separate from marital property, the courts will not consider it a marital asset.

What Can I Do to Ensure My Inheritance Remains Separate Property?

If you want to ensure your inheritance remains separate property in the event you divorce your spouse, there are steps you can take to ensure your inheritance is protected. This includes, but is not limited to, the following:

  • Keeping inherited money in a separate bank account
  • Documenting proof you inherited the funds
  • Refraining from using these funds to make purchases like a family home
  • Refraining from paying off marital debts with the funds

Unfortunately, co-mingling assets can be as simple as depositing a paycheck you earned during your marriage into the account housing your inheritance. This action is enough to turn it into marital property.

If you are the beneficiary of an inheritance and wish to keep it separate property or you are worried about the state of your assets during your divorce, it’s essential to connect with an experienced attorney. At the Zitser Family Law Group, our dedicated team understands how challenging it can be to navigate a divorce when you have complex assets. That’s why our team is committed to working with you to help protect your assets.

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