Your spouse wants to get divorced. You find out about it six months after you get a $1 million inheritance from your parents.
Is that money marital property? Are you required to split it with your ex, giving him or her roughly half of the money when you break off your marriage? Or does it stay with you, since your parents intended it to go to their actual child, not an ex-spouse that left the family?
Under Ohio law, an inheritance is separate property, not marital property. This means that the $1 million likely belongs to you alone. Your spouse cannot divorce you and expect to take $500,000 along on the way out the door.
That said, separate property can be turned into marital property if you commingle it with other marital assets.
For instance, perhaps you and your spouse have an investment portfolio that is worth $200,000. It clearly belongs to both of you, and both of your names are on it. It’s been doing well, so you put the $1 million in the account to boost your earnings before retirement.
Or, perhaps you still owe on your home and your vacation property. You decide to pay off both of those mortgages with the inheritance money. Those properties belong to both you and your spouse. That likely commingles the inheritance as well, as if you’d given the money as a gift to your spouse.
The key, then, is to keep the money separate. Put it in your own investment account or bank account. By doing so, you demonstrate that your spouse could not use it during the marriage and is not entitled to it after the marriage.
As you can see, knowing your legal rights and understanding exactly what steps to take is critical during a divorce.
Source: Market Watch, “My husband inherited money — should I divorce him after he pays off our mortgage?,” Quentin Fottrell, accessed March 28, 2018