• In Minnesota, non-marital property is generally not subject to division. If the inheritance is non-marital property, which most will be, you would not be entitled to a share of your spouse’s inheritance, even if it was received during the marriage.

  • Documentation is key. Keeping clear records of property ownership, as well as gifts and inheritances, can help distinguish between marital and separate property during divorce proceedings. A separate account for inherited funds, with no new assets from the marriage added, is the best way to keep property separate. Document this explicitly!

  • The division of marital and separate property can vary widely depending on local laws. We can help you familiarize yourself with your state’s specific regulations.

  • Prenuptial Agreements agreements can specify what happens to certain assets during a divorce, potentially overriding the default state laws regarding marital and separate property.

If your spouse receives an inheritance before or during your marriage, you may be wondering if you’re entitled to a share of that inheritance as part of your divorce.

The short answer is: probably not. With some caveats.

Divorce and Inherited Property in Minnesota

In Minnesota, non-marital property is generally not subject to division. In other words, if the inheritance is non-marital property, you would not be entitled to a share of your spouse’s inheritance as part of the divorce proceeding, even if it was received during the marriage.

Importantly, the burden of proving that an asset is non-marital property is on the spouse asserting the non-marital claim. In order to prove the non-marital nature of an asset, the spouse must be able to “trace” the funds to a non-marital source and also show that no marital funds were commingled with the non-marital funds.

In the case of an inheritance, you will want to ensure that the donor intended for the inheritance to go only to one spouse. If the intent was for the inheritance to go to both parties, there is no non-marital claim.

It may be helpful to zoom out a bit.

A vacation home inherited

Marital Property Versus Separate Property Explained

Understanding the difference between marital and separate property is crucial when navigating the financial implications of a divorce. This distinction directly affects how assets are divided between spouses, meaningfully impacting each spouse’s financial future.

Marital Property

Marital property includes all assets and debts acquired by either spouse during the course of the marriage. This is essentially “joint” property.

It doesn’t matter whose name is on the title; if it was acquired while married, it’s generally considered marital property in the state of Minnesota. Marital property and marital assets are subject to division during a divorce. Depending on the state, property division aims to be either equal (as in a community property state) or equitable division, meaning fair but not necessarily equal (equitable distribution states, including Minnesota).

Examples include:

  • Income earned by either spouse

  • Homes and other real estate properties bought during the marriage

  • Vehicles, furniture, and other tangible items purchased during the marriage

  • Joint bank accounts and the money in them

  • Investments and retirement accounts contributed to during the marriage

Separate Property

Separate property refers to assets that belong exclusively to one spouse, typically not subject to division in a divorce.

Separate property includes:

  • Property owned by one spouse before getting married

  • Gifts and inheritances received by one spouse alone, even if acquired during the marriage

  • Personal injury awards received by one spouse, in many cases

  • Property acquired after the legal separation

There’s an important “but” to separate property or inherited money: once these assets have been “commingled” with other marital assets – by putting them into a joint bank account, for example – the state may no longer view this property as separate. This is a crucial consideration when it comes to divorce and inheritance.

What is Commingling When It Comes to Marital Property

Commingling in the context of marital property law refers to the mixing of separate property (assets owned by one spouse prior to the marriage or received as a gift or inheritance) with marital property (assets acquired by the spouses together during the marriage).

When separate property is commingled with marital property to the extent that it becomes difficult or impossible to distinguish one from the other, the separate property may lose its distinct status and be treated as marital property, subject to division in a divorce.

Back to the Other Spouse’s Inheritance Question

Let’s go back to the original question: “Am I entitled to my spouse’s inheritance in a divorce?”

If your spouse received an inheritance – like an investment account – and the account remained solely in their name, with no new “joint” assets entering the account – it will remain your spouse’s asset and is not subject to division under divorce and inheritance laws. It will be considered separate property. Maintaining separate accounts and access is important here.

If the inherited funds are added to a joint account, they would be considered commingled and subject to property division.

What about real estate? If your spouse acquired real estate, like a family home or investment property, through inheritance, use of the property could complicate fair division. Did you make upgrades with joint money? Was it used repeatedly for family vacations over many years? These factors can complicate what is considered separate property or not.

Common Questions We Hear

Should I Add an Inheritance To a Joint Bank Account?

Depositing inherited money in a joint bank account to which your former spouse or current spouse also contributes/use funds is a no-no.

Is My Inheritance Safe in a Separate Bank Account?

Very likely yes, your inherited assets will be kept out of the marital estate subject to property division so long as marital funds are not commingled.

Paying the Mortgage on a Separate Property or Home with Marital Funds

If one spouse owns a home before a marriage (separate property) and, after marrying, both spouses use their marital earnings (considered marital property) to pay the mortgage, make improvements, or maintain the home, this can lead to commingling. The increase in the home’s value due to these contributions, or the equity built by paying down the mortgage with marital funds, may be considered marital property. In a divorce, the non-owning spouse may have a claim to a portion of the home’s value or equity, even though the original property was acquired before the marriage!

Renovating a Separate Property with Marital Funds

Imagine one spouse brings a property into the marriage that they own outright. During the marriage, both spouses decide to renovate the kitchen and upgrade the bathroom using funds from their joint bank account, which is filled with earnings accumulated during the marriage. These improvements potentially increase the home’s value. Since marital funds were used to enhance the separate property, the increased value attributable to the renovations might be considered marital property. This scenario means that the non-owning spouse could be entitled to a portion of the property’s increased value in a divorce settlement.

What If My Spouse Dies: Do I Get Their Inheritance Money?

That all depends on how the deceased spouse’s estate was set up, and whether the surviving spouse is a joint owner on these properties or accounts.

This question goes beyond the scope of this article, but suffice it to say that all of the following could play a role:

  • How an asset was titled, or whether designated beneficiaries were named

  • How or if the deceased spouse used a will

  • How probate court handles the estate

  • and more!

Surviving spouses have a lot on their minds in the immediate aftermath of a death, and sorting out an estate muddled by past inheritances can be even trickier. If your spouse has passed, a good estate attorney can help smooth this emotionally challenging process.

How To Protect Separate Assets or Inherited Assets In a Marriage

The best way to protect separate property is through a prenuptial agreement, or even postnuptial agreement.

Maintaining separate accounts for inherited property, and never commingling assets, is the next best thing.

Navigating Asset Division and Preserving Your Rights: Call Our Team For a Free Consult

Understanding your rights and responsibilities when it comes to inherited property can be key to securing your financial future during and after a divorce. Don’t navigate these complex waters alone. Our boutique team of experienced family law attorneys is here to help guide you through the asset division process with care. Schedule a free consultation – call us at 952-800-2025 or reach out via our online contact form to set up your free consultation.

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