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Inheritance money can be sticking point during divorce

Inheritance funds sometimes crop up in property division negotiations during a Montana divorce. Specifically, are the funds considered marital property during a divorce proceeding, and can the non-inheriting spouse share the other spouse's inheritance if the funds were received during the marriage? The answer to this question typically depends upon what was done with these assets after they were received.

In general, if a spouse receives an inheritance, it is considered separate property and does not have to be divided in a divorce according to Montana's equitable distribution laws. As separate property, the funds are considered solely the property of the spouse who received them. But that's not necessarily the end of the issue.

If the spouse receiving the inheritance deposited the funds in a joint account, the immunity is lost. In those circumstances, the inheritance became a marital asset, and is subject to equitable distribution between the spouses in a subsequent divorce proceeding. In the same way, if the inheritance funds were used to improve the couple's marital home, they would then be considered marital property.

Understandably, the division of property, including inheritance funds, can be confusing. For this reason, it is often a source of conflict for divorcing couples in Montana and elsewhere. However, an attorney can explain the applicable laws and push for a result favoring the client, whether one ends up reaching a settlement or litigating the divorce through a trial. The benefit of working toward a settlement is that a couple may avoid the stress and extra cost that typically accompanies going to trial.

Source: findlaw.com, "Inheritance and Divorce", Accessed on Jan. 9, 2018

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