What is an inheritance protection agreement?

Inheritance Protection AgreementIf you are entering a marriage and want to be sure that you protect your inheritance in the event of a divorce, writing this into a prenuptial agreement or creating a separate protective measure is a good place to start. There are additional things that your attorney will advise you on, which will include keeping these portions of your finances entirely separate. An Inheritance Protection Agreement specifically deals with future or possible inheritance. When these expected inheritances are received, the Inheritance Protection Agreement keeps all of the inherited assets explicitly separate from commingled assets that you and your spouse may accumulate during your marriage.

How Is Inheritance Normally Handled?

If you do not have any documentation that clearly separates your inheritance from your spouse, it could pose some issues during a divorce if you do not handle it in a certain way. Inheritance is treated like a separate asset – an asset that was brought into the marriage, or was gifted or inherited during. However, if you choose to then put your inheritance into a joint account, or put your spouse’s name on the title of the inherited property, then you will turn that asset from separate to marital property.

If you have specified the inheritance in a prenuptial agreement that clearly protects the entire amount of this inheritance, no matter how you handle it, you may be able to avoid any issues in court. That said, it is a much more prudent option to keep it separate.

How Does an Inheritance Protection Agreement Help?

If you are expecting any possible future inheritance, work with an experienced Miami family law attorney to ensure that this is clearly and completely addressed in your prenuptial agreement. In this agreement, they will specifically state that your inheritance is a separate asset from any marital property, and will give you additional legal advice to ensure that you keep it from being co-mingled.

They may suggest that you revisit the prenuptial agreement after you receive the inheritance, but this will all be clearly stated in the initial agreement as well. Once you get your inheritance, you may also want to hire a wealth manager who has access to your prenuptial agreement and understands that you are working to keep these assets entirely separate.

What Other Ways Can I Protect My Inheritance?

Aside from an inheritance protection agreement and a prenuptial agreement, there are standard practices to keep your assets separate. Do not place your inheritance in a joint account, use it to pay family bills, or allow your spouse or any of your joint assets to pay taxes on your inheritance.

One of the best ways to protect your inheritance is to discuss your options with an attorney, as well as a financial adviser. They will both have experience in dealing with marital property, asset divisions in divorces, prenuptial and inheritance agreements, and more. The advice that they will give you will be essential to protecting your personal assets and ensuring that you never do anything to cause confusion about whether or not they are marital property.

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