How does inheritance affect asset division in high-asset divorce?
High-asset divorces often involve complex financial matters, including the division of inheritance. Inheritance affects asset division significantly, depending on how the spouses handle the inheritance during the marriage.
Understanding how Ohio state law treats inheritance is important when navigating asset division in high-asset cases.
Separate property vs. marital property
In Ohio, inheritance typically qualifies as separate property, meaning it belongs solely to the individual who received it. However, if the recipient mixed the inheritance with marital assets or used it to benefit both spouses, it becomes marital property. This concept, known as “commingling,” complicates asset division during divorce proceedings.
Commingling inheritance
When someone deposits inheritance funds into a joint bank account or uses them for joint expenses, the funds become commingled. In such cases, the court may determine that the inheritance is no longer separate property and is instead subject to equitable division. The recipient must prove that they did not commingle the inheritance if they wish to retain it as separate property.
Protecting inheritance in a high-asset divorce
To protect inheritance from becoming marital property, it is important to keep it separate from other marital assets. Maintaining a separate account for inherited funds and avoiding using those funds for marital expenses helps ensure the inheritance remains separate. Couples may also draft a prenuptial or postnuptial agreement to clarify how inheritance will be treated in the event of a divorce.
Dealing with asset division
Inheritance complicates asset division in high-asset divorce cases. Understanding Ohio’s laws on separate and marital property helps individuals make informed decisions and protect their interests during divorce proceedings.