Every grandparent, parent, sibling or child wants his or her loved ones to be happy. However, when it comes to matters related to marriage, remarriage or divorce; a loved one’s spouse or ex-spouse may not be held in the highest esteem.
Many inheritance disputes involve second wives or husbands and divorced spouses. To avoid potential inheritance lawsuits, assets must both be left and retained in specific ways. For example, a parent who gifts a grown child $10,000 each year would be wise to ensure that only the child’s name appears on any related documentation including tax receipts.
Additionally, the recipient of any inherited assets would be wise to take measures to keep such assets separate. Co-mingling inherited assets with those held jointly with a spouse automatically negates an individual’s claim to those assets in a divorce. Instead, inherited assets should be held in a separate bank account. Likewise, if inherited assets are used to purchase a home or car, an individual would be wise to ensure that only his or her name appears on the title.
Individuals who plan to leave assets to a grown child or grandchild would also be wise to take measures to protect those assets in the event of a marriage or divorce. Establishing a trust and naming a loved one as the sole beneficiary is a good way to ensure assets are protected and cannot be accessed by a loved one’s spouse or considered marital property in a divorce.
Individuals who both plan to leave assets and who inherit assets would be wise to meet with an estate planning attorney. An attorney who handles estate planning and probate litigation matters can assist in helping ensure an individual’s assets are protected.
Source: The Wall Street Journal, “How to Keep Your Inheritence in a Divorce,” Neil Parmar, Nov. 9, 2014