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If I Get Divorced in Wisconsin, Is There a Way to Keep My Inherited Assets?
Going through a divorce is a complicated process, and the thought of losing property, assets, or money that you inherited can add to the stress, but there are legal means to protect yourself.
In Wisconsin, the laws concerning property division are complex. Our empathetic and knowledgeable family lawyers understand you may feel concerned about protecting what’s yours. This is especially true for assets from your family, such as a home passed down through generations or a sum of money from a loved one.
When facing a divorce in the Sheboygan area, you must understand how Wisconsin law treats inherited property. Our skilled and tenacious family lawyers will work diligently to help you navigate these issues and give you peace of mind.
Some Facts You Need to Know About Wisconsin’s Marital Property Law.
Remember that Wisconsin is a community property state (also known as a marital property state). This means that the family court starts with the assumption that all property and debts acquired during your marriage should be divided equally between the spouses. However, there are important exceptions to this rule.
Wisconsin Statute § 767.61 provides a clear legal framework for how courts divide property in a divorce. The law states that property acquired by a spouse through inheritance or as a gift from a third party is generally considered separate property. This individual property is not part of the marital estate and is therefore not subject to the usual 50/50 division.
These exclusions apply to more than just cash. They can also apply to inherited real estate, personal property, business interests, etc.
What Should I Avoid So My Inherited Assets Don’t Become Marital Property?
While the law aims to protect inherited assets, commingling is a critical way for them to lose their separate status. This is the most common reason an inheritance becomes subject to division in a divorce.
Commingling happens when you mix your inherited assets with marital property. When this occurs, the separate property can become so blended with joint assets that it loses its individual identity.
Here are some common examples of how commingling can happen:
- Depositing funds into a joint bank account. If you inherit money and put it into an account you share with your spouse, the court may see that as an intent to share the funds. This can make the entire account legal marital property, including the inherited funds.
- Using inherited money to purchase a joint asset. For example, using inherited cash as a down payment on a home that the two of you live in and own together.
- Improving inherited property with marital funds. Let’s say you inherited a cabin in Random Lake. If you and your spouse use your joint savings to build an addition or make significant repairs, the court may view the increased value as marital property.
It’s not just about money. The same logic applies to other inherited assets. If you inherited a car and your spouse paid for its maintenance and upkeep for years, the court might consider it a shared asset.
What May Occur if My Inherited Assets Appreciate?
This is another important and often misunderstood aspect of Wisconsin law. Even if you keep an inherited asset separately, any increase in its value during the marriage can be considered marital property.
Consider this example: You inherited a stock portfolio worth $50,000 during your marriage. Ten years later, it’s worth $150,000. In a divorce, the initial $50,000 may remain your separate property. However, the $100,000 gain in value could be considered marital property and subject to division. As your thorough family lawyer will explain, accurately tracing your assets’ value is essential.
What Is the Hardship Exception and How Does the Wisconsin Family Court Handle It?
Even if you successfully kept your inheritance separate, it’s at the court’s discretion to divide it in some extreme cases. Wisconsin law includes a “hardship exception.” This exception gives power to the court to divide separate property if it finds that refusing to do so would create a hardship for the other spouse or the children of your marriage.
For example, a court may apply this rule if one spouse has little to no income or assets and serious health issues, and the inherited assets are the only way to prevent extreme financial difficulty. While not common, this exception shows why a skilled family lawyer’s advice and guidance are essential. A passionate family lawyer can help you prepare for all possibilities and build a strong case to protect your assets.
Some Practical Tips for Protecting Your Inheritance In a Divorce in Wisconsin.
The best way to protect your inherited assets is to be highly proactive. Here are just a few of the steps you can take:
- Keep Things Separate: Do not mix inherited funds with joint accounts. Open a separate bank account in your name only for any inherited cash.
- Maintain Clear and Accurate Records: Keep detailed records of the inheritance. This includes the date you received it, its value, and any documents from the person who gave it to you.
- Consider a Marital Property Agreement: You can enter into a marital property agreement (a prenuptial or postnuptial agreement) before or during your marriage. This legal document can define how specific assets, including inheritances, will be treated in a divorce.
You do not automatically lose your rights if you have already commingled assets. We can work to trace the separate portion of the property and argue for its exemption. This process, called “tracing,” is a key part of property division in Wisconsin divorces.
Why Local Experience Matters
The Sheboygan County Court handles all divorce cases in the area. Every judge has a way of examining and dissecting these complex issues. An experienced, communicative, and diligent family lawyer familiar with the local court system and its specific procedures is a significant advantage. The family law team at the HKK Law Offices serves clients in Sheboygan and nearby communities such as Random Lake and Mequon. They intimately understand the unique needs of those who live and work here.
They know that a divorce is not just a legal matter; it’s a profoundly personal journey. Their key role is to be your dedicated advocate, someone you can rely on to be accountable, approachable, and responsive. They also believe in providing clear, plain-English explanations so you always know where you stand.
I Wish to Save My Inheritance in My Divorce; How Should I Proceed?
If you are facing a divorce and have questions about protecting your inherited assets in Wisconsin, don’t hesitate. The best way to understand your options is to speak with a qualified, experienced family lawyer focused on your needs.
At HKK Law Offices, we offer free, confidential consultations to discuss your unique situation. We strive to listen deeply, answer your questions, and help you create a strategic plan to protect your financial and legal interests.
Contact our offices today to schedule your free consultation in Random Lake at (920)-782-7757, Mequon at (262)-360-6930, or Sheboygan at 920-635-2992. We will work tirelessly to give you and your family the peace of mind you deserve.
