Is Inheritance Considered Marital Property In Indiana?
Key Takeaways
- Indiana is an equitable distribution state.
- Inheritances are usually considered marital property.
- The court looks at several factors when determining property distribution, including commingling funds.
- You can appeal property distribution when the court enters the final judgment.
An inheritance is not just about financial gain. For most people, inherited assets represent something significant and personal from someone they love, making it difficult to consider the idea of dividing an inheritance during a divorce. Whether it is a family heirloom, a financial windfall or property, understanding how your inheritance will be treated during a divorce is crucial.
An Indiana family law firm can guide you in protecting your inheritance during a divorce and explain what factors the court considers in property division.
Is an Inheritance Marital Property in Indiana?
The answer to this question is, “Yes, the inheritance is marital property.” Your next question might be, “When does an inheritance become marital property?” The short answer is, “Usually, as soon as you receive it.”
Indiana operates under the “one pot” theory of marital property. All property belonging to either or both spouses is considered marital property. However, this presumption can be rebutted, especially if you didn’t comingle the inheritance.
Indiana Property Division Factors
Indiana is an equitable distribution state. Property is not divided in half as it is in community property states. Thus, depending on several factors, one spouse might receive 60 percent and another 40 or any combination of percentages, including half. The factors the court reviews include:
- Economic needs
- Contributions to the marriage
- Current income
- Earning capacity
- The duration of the marriage
- Tax consequences of property distribution
- Child support obligations
The state presumes equal division, but only if all factors are equal. Another circumstance that significantly affects property division is time sharing. The court may award the house to the spouse with the larger share of time-sharing, even if the other spouse owns the house.
Additionally, as part of the equitable division of joint property, if the tax consequences are overly burdensome for one spouse, the court could award that property to the other spouse to relieve the extra tax burden.
Inherited Property Before Marriage
Inherited property and property brought into the marriage are all put into the pot and subject to equitable division by the court. However, the court can consider whether that property should be set aside for the spouse who inherited it or brought into the marriage.
If you used commingled funds to maintain the property or put it in a joint account, the court will most likely rule the inheritance is marital property.
Can I Appeal the Property Division in My Divorce?
Nothing is perfect, and that includes the judicial system. Sometimes, mistakes result in a wrong decision, even in divorce proceedings. That is why we have appellate courts. If you believe the family court made a wrong legal decision, you can appeal the final judgment. The Court of Appeals can agree with the family court’s decision, vacate it, modify it or reverse it.
Because the family court has broad discretion in valuing and dividing marital property, the appellate court will only set aside a ruling if the family court doesn’t follow the rules. For example, if a family court places a certain value on the marital home, but the documentation doesn’t support it, the appellate court could overturn the ruling or send it back to the family court to do it right.
Why Work with Cordell & Cordell
Even if you and your spouse agree to a divorce, whether you agree on all of the issues or not, it is a life-changing experience, especially for couples who married early and have never really lived on their own. You worked hard for marital assets, including real estate. You may even have inherited funds that were meant for you. Indiana divorce lawyers at Cordell & Cordell have experience in all types of Indiana family law issues, including the division of assets such as inherited money. Put that experience to work to help guide you through the Indiana divorce process.
Client Experience
“[My lawyer] is leaps and bounds above my last experience with an attorney. I am pleased with the outcome of the services provided. Thank you again.” — Anonymous
“My attorney was very attentive and I feel he really cared about the case and not just about the money.” — Isaac H.
Protect Your Personal Assets in a Divorce
In the event of an Indiana divorce, you may need legal advice from a family law attorney, especially if you have joint bank accounts, marital expenses to split, an inheritance, other joint funds, children, and either of you needs alimony. Contact Cordell & Cordell for a consultation if you were served divorce papers or if you plan on filing for divorce.
** Disclaimer: This page serves as a resource and is not to be taken as legal advice.
Written by Joseph E. Cordell
Joseph E. Cordell is the Principal Partner at Cordell and Cordell, P.C., which he founded in 1990 with his wife, Yvonne. Over the past 25 years, the firm has grown to include more than 100 offices in 30 states, as well as internationally in the United Kingdom. Mr. Cordell is licensed to practice in the states of Illinois and Missouri and received his LL.M. from Washington University in St. Louis, Missouri. Joseph E. Cordell was named one of the Top 10 Best Family Law Attorneys for Client Satisfaction in Missouri.
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