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Protecting inheritance from division in divorce, P.2

In our previous post, we spoke a bit on the topic of how to protect inherited property from being divided in divorce. In addition to suggesting saving documentation, using separate accounts, and putting the property in a trust, we also mentioned using a prenuptial agreement to protect inherited property. Here we wanted to offer a few comments about this option.

Prenuptial agreements, as readers know, may establish the financial terms of divorce, including how inherited property is to be handled. Couples can use a prenuptial agreement to protect property inherited prior to marriage which is at risk of becoming commingled or property inherited after marriage which a spouse may be able to lay claim to. 

Let’s consider a couple examples. Take inherited real estate, for example. Whether the real estate is inherited prior to marriage or during the marriage, a spouse may be able to lay claim to part of its value in divorce if he or she made contributions to its improvement. A prenuptial agreement can clearly establish that the property will remain the sole possession of the inheriting spouse, regardless of any contributions made by the other spouse. The same thing goes with an inherited business. Prenuptial agreements can specify that the non-inheriting spouse may lay no claim to the value of the business in divorce, regardless of any contributions they make during the marriage.

Prenuptial agreements can also prevent a spouse from forcing the division of inherited property if it is determined that the judgment of divorce or separate maintenance is inadequate to support him or her. Granted, the outcome is less likely to be challenged when a strong prenuptial agreement exists.

The key with prenuptial agreements, as we’ve mentioned before on this blog, is to make sure they are drafted carefully and executed properly. Without taking care to do things correctly, prenuptial agreements simply become another thing for couples to fight over in divorce, so work with an experienced attorney.

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Protecting inheritance from division in divorce, P.2 | Peter A D'Angelo, Attorney at Law, PLC