In California, separate property consists of property owned earlier than marriage, and items and inheritances obtained in the course of the marriage. Whereas inheritances are typically thought of separate property, they will grow to be commingled with neighborhood property (property acquired in the course of the marriage) if not rigorously managed. As an example, depositing an inheritance right into a joint checking account used for family bills might remodel the inheritance, or a portion thereof, into neighborhood property topic to division in a divorce. Equally, utilizing inherited funds to enhance a jointly-owned house 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 stop unintended commingling, preserving the separate property nature of an inheritance. That is significantly essential in California, a neighborhood property state the place property acquired throughout marriage are typically divided equally upon divorce. Defending inheritances as separate property ensures that these property stay underneath the only management of the meant beneficiary.