In California, separate property contains property owned earlier than marriage, and presents and inheritances acquired throughout the marriage. Whereas inheritances are usually thought-about separate property, they’ll change into commingled with neighborhood property (property acquired throughout the marriage) if not rigorously managed. As an example, depositing an inheritance right into a joint checking account used for family bills might rework the inheritance, or a portion thereof, into neighborhood property topic to division in a divorce. Equally, utilizing inherited funds to enhance a jointly-owned dwelling may additionally create a neighborhood property curiosity within the elevated worth.
Understanding the excellence between separate and neighborhood property is essential in defending particular person monetary pursuits throughout marriage and within the occasion of divorce. Clear documentation and cautious monetary administration can forestall unintended commingling, preserving the separate property nature of an inheritance. That is significantly vital in California, a neighborhood property state the place property acquired throughout marriage are usually divided equally upon divorce. Defending inheritances as separate property ensures that these property stay underneath the only real management of the meant beneficiary.