Alimony & Inheritance
While the divorce process is rife with hot buttons, one particularly emotional issue is that of your or your spouse's inheritance and what role that plays in your case. As your separate property, an inheritance is almost never divisible by a court in community property or equitable distribution proceedings. It can, however, be a major factor in your alimony case.
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Alimony And How It Is Calculated
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Alimony is support paid by a supporting spouse to a dependent spouse, either as a lump sum or in periodic payments, for a time period specified by the court or the agreement of the parties. In general, you qualify as a dependent spouse if you are actually and substantially dependent upon the other party to keep you in the standard of living to which you became accustomed during the marriage. Once entitlement to alimony is established -- and entitlement can be a complex issue in any state -- the court determines an amount of alimony by looking at the needs of the dependent spouse and the ability of the supporting spouse to meet those needs.
Inheritance In Divorce Cases
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Although your ex probably can't reach your inheritance under your state's equitable distribution or community property laws, she probably can get at it in an alimony case. A court could order you to transfer money or property in a lump sum to satisfy an alimony award, even if that money or property is actually your separate property. More commonly, your possession of an inheritance influences your need to receive or your ability to pay alimony. If you're sitting on a substantial separate estate that's producing an income, you don't need as much money from your ex to meet your expenses. Likewise, the same estate will provide you with more income with which to meet your ex's needs.
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Inheritance And Alimony Modification
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Alimony set in a valid, unincorporated (not made part of your divorce decree by reference or attachment) separation agreement generally isn't modifiable, as principles of contract law prevent courts from interfering with most parts of an agreement. If your alimony award is set by court order, however, the receipt of an inheritance could constitute the kind of substantial and material change of circumstances that can justify modification of an award. If the supporting spouse gets it, he may be in a position to pay an award that better meets the needs of the dependent spouse. If the dependent spouse receives it, she may no longer be dependent.
The Role Of An Expected Inheritance
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If your parents or your former in-laws are rich and you can be expected to inherit a sizable estate, this typically won't affect any portion of your divorce case. If anyone from whom you or your ex expects to inherit is still alive, all you have is an expectation; the parent or grandparent in question could spend all the money before they die, or claims against the estate could whittle it down to nothing. Some states, however, have drawn a distinction between an expected inheritance and an undistributed inheritance from an estate.
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References
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