Article: Boyd Law, San Diego CA
When going through a divorce, it is already tough for the couple, but when the case here is a high net worth divorce involving inherited wealth, the process gets even more complex. Many people are unsure how courts handle assets that one spouse inherited. Before that, you must be aware of the court and the divorce proceedings.
Suppose you are in San Diego, California’s second-largest city, situated at the heart of a metropolitan area that encompasses all of San Diego County. Known for its strong economy, diverse population, and status as a major hub for biotechnology, defense, and tourism, San Diego also has a well-established family court system that regularly handles complex property matters. If you or your spouse has received an inheritance, then the consequences after the divorce that you are facing are not that difficult.
Consulting with a trusted divorce attorney in San Diego can provide valuable assistance, and understanding the inherited assets helps protect your financial future during a divorce by clarifying how they might affect the outcome.
Understanding Inherited Wealth vs. Marital Assets During Divorce
Inherited wealth includes money, property, or valuables received from a family member or loved one after their death. In divorce, inherited assets are typically treated as separate property, meaning they belong solely to the person who inherited them.
Marital or community property refers to any assets acquired during the marriage by either spouse, such as income or property purchased jointly. Inherited property can lose its separate status if it is commingled with marital assets, such as being deposited into a joint account or used to buy shared property.
Separate Property or Marital Property: The Legal Standard
Keep in mind that inherited assets are typically considered separate property under state law. This means they belong to the person who received them, not both spouses. However, courts closely examine how the inheritance was handled during the marriage.
If inherited money or property is commingled with marital assets, it can lose its separate status and be divided during a divorce. Therefore, it is best to consult a trusted attorney who is well-versed in divorce in San Diego.
Factors That Transform Inherited Wealth
Inherited wealth can become marital property if:
- Inheritance is deposited into a joint bank account.
- Funds are used for family expenses, such as paying household bills or making mortgage payments.
- Money is invested in improving or buying a marital home or other shared assets.
The Role of Commingling
Commingling happens when separate inherited assets are mixed with marital assets to the point that their source is unclear. If this occurs, courts may treat some or all of the inheritance as marital property, making it more challenging to maintain the inheritance’s separate status in a divorce.
High Net Worth Divorce Dynamics: Special Challenges
Here, dividing assets in high-net-worth divorces is challenging because estates often include trusts, businesses, and property located in different places. Valuing these assets takes experts and can lead to disagreements between spouses.
Trusts and business interests must be closely reviewed to determine if they are part of the marital estate, as some assets may be hidden or difficult to locate. There are also privacy concerns, as financial details can become public in court.
The emotional stress is high, especially when inherited wealth is involved or family members are connected to assets.
Conclusion
If you believe your inherited wealth could be at risk in a divorce, act quickly to protect your interests. Keep your inheritance in a separate account and never mix it with shared assets. Always speak to a skilled divorce attorney as soon as possible. An experienced lawyer will guide you, help keep your financial information safe, and defend your rights.
