How Are Gifts Inherited Property Divided California Divorce

Dividing property in a divorce in California can be challenging. Understanding how the process works will help you keep your property separate.

Inherited Property

California law specifies that property inherited by one spouse during a marriage is separate and, thus, not subject to the "community property" rule. However, if a will says that the property you inherited belongs to "you and your family," it can be hard to determine the ownership.

For example, if one of your distant relatives left "you and your family" a house in their will, your spouse can still claim it. You will be responsible for proving that the deceased relative intended for you to receive the asset for yourself.

Also, if you inherited an asset and co-mingled it with your combined marital assets, the ownership of the inherited property can be invalidated. For example, the inherited cash amount placed in a joint bank account can cause the inheritor to lose their sole interest. Similarly, if you inherit a home, but you and your spouse moved into it during your marriage, the house will be considered community property during the divorce.

Gifts

According to California laws, gifts given to one spouse by the other during a marriage are considered separate property. So, for example, if your spouse gifted you a car on your birthday, it will be yours in the divorce.

However, problems can arise if the intent needs to be clarified that the property/asset was a gift. For example, if your spouse bought a new car for Christmas, but it was intended for both of you to use in your life together, it becomes difficult to decide whether or not the car was a gift. 

If you or your spouse received any gifts from a third party (a family member or a friend), those are usually considered separate property. You should document the receipt of an estate and any notations that will help identify the ownership to avoid disagreements later on.

Schedule A Consultation With California Divorce Attorney

If you and your spouse have decided to divorce, and you want to ensure that your assets stay with you, call us to set up a free consultation. At Moshtael Family Law in Orange County, CA, we can help you better understand your marital estate division so you can come out on the other side with a financially secure future.