What Happens To Inheritances & Family Money In A Divorce In IL & MI
You got the call. Your beloved Aunt Mildred has passed, and she left you $150,000. It’s a bittersweet moment. You file it away.
Five years later, you’re getting divorced. You’ve already accepted that the house and the 401(k) will be split, but then your spouse says, “I want half of Aunt Mildred’s inheritance.”
Your gut reaction is, “Not a chance! That was my aunt! That money is mine!”
Is it?
As with all things in divorce law, the answer is “It depends.” Our Chicago, IL complex divorce lawyer is here to help you understand the process.
Non-Marital Vs. Marital
Here’s the good news: Both Illinois and Michigan are equitable distribution states, and both recognize the concept of non-marital (or “separate”) property.
Generally speaking, an inheritance or a gift given specifically to you (and not to you and your spouse as a couple) is considered your non-marital property. That means it’s yours. It does not go into the marital pot to be divided.
So you’re safe, right?
Not so fast. This is, without a doubt, the single easiest legal protection to accidentally mess up.
The $150,000 Mistake: How “Yours” Becomes “Ours”
You can have the strongest non-marital claim in the world, and you can lose it in a single well-intentioned bad-idea afternoon. This is called “commingling” (mixing) or “transmutation” (changing).
Here’s how you accidentally give your ex half of Aunt Mildred’s money:
- The Joint Account Dump: You got the $150k check and you deposited it right into your joint checking account, which you use for groceries and mortgages. You just commingled the funds. That money is now legally mixed with marital money.
- The House Down Payment: You used that $150k as a down payment on a new house, and you put the house in both of your names. You have just transmuted your non-marital cash into a marital asset. That house is now part of the marital estate.
- The “I Can’t Prove It” Problem: You put the money in a separate account in your own name, but you’ve lost the paperwork. You can’t trace the money from your aunt’s estate to that specific account. You have the burden of proving it’s non-marital, and if you can’t, it may get lumped into the pot.
How to Protect It (The Right Way)
- If you’re still married: Keep it separate! That money goes into a new bank account in your name only. Never, ever use it for marital expenses, and keep a clean paper trail.
- If you’re getting divorced: This is when you hire us and a forensic accountant. Our job is to trace that money, dollar for dollar, from its source to its current location to prove its non-marital status to the court.
That money was intended for you. Don’t lose it over a simple and avoidable mistake.
Don’t let your inheritance become a casualty of your divorce. We know how to trace it, protect it, and fight for it. Connect with Merel Family Law today and let’s get your story straight.
