INHERITANCE IN DIVORCE AND SUPPORT
If you are divorcing in PA, you may be wondering whether your inheritance will be shared with your spouse when you divorce. Generally, inheritance is considered a separate asset in a divorce. However, this is provided that you keep that inheritance separate, in your own name. The principal of the inheritance will remain non-marital, but the increase in value of that inherited asset will be marital. For example, if your mother left you $100,000 and you invested that money in an account in your own name, but when you decide to separate it is now worth $130,000, you get to keep the $100,000 but the $30,000 it in increased will be marital.
If you received a home that is deeded in your name and you do not add your spouse to the house, the value that the house increases will be marital but the value at the time you received it will remain your own. Be wary of the value you claim on inheritance tax forms as you do not want to undervalue assets if you are married. You may do yourself a disservice as the increase will be much greater if the court uses that undervalued number in a divorce.
If you gift the inheritance to the marriage by adding your spouse to the deed or the account where the money is deposited, it becomes a marital asset. Some counties, such as Bucks County, will give you some credit for this gifted asset if you get divorce based on a twenty year diminishing value. What this means is that after twenty years you will not get any credit for the inherited asset but prior to twenty years you will get a fraction back based on time. Other counties consider the gift but may apply a credit in their own way which could be unpredictable.
The support statutes are very clear and any money you receive by inheritance is not going to be factored as income when the court determines how much support you are entitled to or how much support you have to pay.
Inheritance is an asset that you have at your disposal and it will be a factor in a divorce. It is the court’s decision on how to allocate the marital assets and if it is a sizeable inheritance. They may decide that you don’t need as much of the marital estate as you would if you did not have an inheritance