Once you enter into a marriage, your life can feel almost entirely co-mingled with your spouse. If you bring assets into the marriage or have a significant inheritance, it is a smart idea to consider having a prenuptial agreement or inquire about asset protection strategies in the event of a divorce.
What should you do if you plan to divorce and have a sizeable inheritance? Will that inheritance be protected? Will you need to split your inheritance with your spouse?
Property division in California can be highly complex. Matters can be complicated even more if you own a business or have significant assets. A divorce can also be complex if there are issues concerning inheritance and retirement account division.
California is considered to be a “community property” state, which means that any assets (or debts) accumulated during the marriage are considered to be community property. Separate property is considered to be property acquired by each spouse prior to the date of the marriage.
So, where does inheritance fall? In many instances, inheritance is protected and not considered to be community property. However, there could be circumstances that could complicate your situation.
What happens with inheritance and business ventures? What happens with real estate and inheritance? If you are an heir it is important you take measures to protect rights in the event of divorce.
There are various asset protection strategies that can be implemented to protect one’s assets. This often starts with identifying what assets are separate property and what assets are considered to be community property. A lawyer who is experienced at handling such situations can explain where inheritance fits in and how other assets (such as retirement) are affected in divorce.
If you are entering into a marriage with an inheritance, you may want to consider a prenuptial agreement. The first step to take is to talk with an attorney about your options and get a full understanding of what’s at stake. You should always have a legal advocate on your side.