When you marry your spouse, you combine your household and your finances to share assets and resources. Much of the divorce process will focus on how you separate your financial circumstances after sharing everything for so long.
Certain assets will likely wind up split in the divorce. The house that you bought together and the retirement accounts you funded during the marriage are probably marital property subject to division. However, there may be other assets that you want to protect as your own, separate property in the divorce.
If you inherited substantial assets from someone you love, will you have to split that inheritance in your divorce?
Colorado classifies most inheritances as separate property
The status of an asset as separate or marital property is largely what determines if the courts have the authority to divide it. Items that you owned before marriage, income you earned while single and gifts that you receive are all separate property in the event of a divorce. So too are assets obtained by bequest or inheritance.
When you inherit something in your name alone, it does not belong to your spouse like most anything else you would obtain or earn during your marriage. The Colorado rules about separate property mean that your inheritance will be yours alone unless issues may give your spouse a claim just some of the property.
Commingling could turn separate property into marital property
You can put your inheritance at risk by commingling it with marital assets. Commingling involves taking two distinct pools of assets and mixing them up in a way that makes it difficult to determine what is what.
Commingling might look like putting financial assets into a joint checking account. Even letting your spouse move into the home you inherited from your grandmother might give them a claim to the property. The establishment of a separate account, the creation of a trust or the signing of a postnuptial agreement are all means by which you could potentially protect your inherited assets while still allowing your spouse to share or access them.
Learning more about your rights can help you protect your assets and push for a fair outcome in your Colorado divorce.