New Jersey Divorce Lawyer Discusses How an Inheritance is Divided
I am often asked as a New Jersey Divorce Lawyer, how an inheritance is treated in a divorce? Here’s an example. Your spouse inherited a million dollars from a random uncle. Now that you’re divorcing, what happens to that money? It’s not your money. It doesn’t just get split right away. In fact, it doesn’t get split at all, except in a couple of scenarios. Let’s start with the basic premise that an inheritance is not generally part of the marital pot that is subject to distribution, but any monies that that inheritance earns will be.
For example, you inherited certain stocks and those stocks paid a dollar in dividends at the end of the year, and your annual salary was $10. Now, for the purposes of computing support, your income is $11. Do you get it? You would add whatever money you made from the inheritance onto your regular income.
Here’s a bigger example. Let’s say you were given a building and you, along with your family, had several renters there. At the end of the year, you have a profit from that building of one dollar, and your salary was $10. For the purpose of calculating support, your salary is $11. You get it? The money earned from your inherited asset is part of the marital pot and is included in the analysis of support whether you’re paying child support or spousal support.
I tell my clients as a New Jersey Divorce Lawyer, not to even buy a cup of coffee for their spouse with inherited property. Why? If you use the inherited income and/or asset for marital purposes, you could change the classification of that asset from an inheritance – a non-exempt asset in the marriage – into the actual marriage, which would allow that to be subject to distribution.
Here’s a recent example of a case I had where an individual received an inheritance from the spouse’s family and then used that money to help build an investment property with her current spouse. When they got divorced, the spouse said, “Wait a second. That was my mom’s money that I got as an inheritance.” The other side said, “Well, no, you had that money and gave it to me, and we used it as if it were ours. Therefore, it’s part of the marital distribution.” It doesn’t get separated from the marital pot, so to speak.
It’s a big deal. When you get an inheritance, look it over. See what it is, consider where it came from, and what monies it might generate. Get with an experienced attorney who can help you understand some of the sensitivities of an inherited asset. Evaluate your best and worst case scenarios, such as whether you can use the asset in your marriage and have it exempt. Figure that out before you start spending money. You have to be careful. Your inheritance may become a part of the marital equitable distribution, so you’ve got to be very careful with it.
Did you receive an inheritance that you want to protect from being divided in divorce? Contact New Jersey Divorce Lawyer Christopher Leon Garibian for guidance.
Christopher Leon Garibian, Esq. is a partner in the matrimonial and family law department of Weiner Law Group LLP. He has over 19 years of experience handling a multitude of Divorce and Family Law Matters throughout New Jersey. He is passionate about family law and takes pride in his ability to effectuate real change in the lives of his clients. He is certified by the State Supreme Court of New Jersey as a Matrimonial Attorney. If you are in need of an experienced Divorce Attorney or Family Law Attorney in NJ, contact us today for compassionate, long lasting legal solutions.