High Net Worth Divorce: Inheritances
While there has been significant research on the acute economic consequences of marital dissolution, the specific effects of marital dissolution on wealth have attracted less attention. Understanding inheritance's impact on high-net-worth divorces is a complex endeavor that requires the skills of an experienced and knowledgeable Oregon divorce attorney.
The Oregon divorce lawyers at Gearing Rackner & McGrath have extensive experience handling complex and high-net-worth divorces. Our attorneys provide clients with individualized attention and personalized strategic case management to ensure a viable and favorable outcome.
Marital vs. Separate Property in Oregon
Part of almost any Oregon divorce is the division of marital property. This complex process can be time-consuming and emotionally draining, especially for couples with significant wealth. Most of the process comes down to determining whether the property is separate or marital.
What is Separate Property in Oregon?
Generally, separate property is property one spouse owned before the marriage. It can also include property one spouse received during the marriage, such as inheritances and gifts.
What is Marital Property in Oregon?
Marital property is anything acquired during the marriage that is not counted as separate property. Some examples of marital property include:
- Retirement accounts;
- Investment properties;
- Bank accounts; and
In most cases, the court will accept the couple’s preferences to settle disputes regarding property disputes. However, the court will divide the property if the couple cannot agree on division.
How Are Inheritances Handled During a High Net Worth Divorce?
Oregon Senate Bill 386 (SB 386) amended ORS 107.105(1)(f) and held that gifted property was not subject to the presumption of equal contribution. Accordingly, SB 386 provides that separately held property one acquires by gift during the marriage is not subject to a presumption of equal contribution. Specifically, SB 386 holds that “property acquired by gift” refers to property acquired by one party through gift, devise, bequest, or inheritance.
Despite this designation, courts may treat inherited property shared between spouses as marital property subject to division. The court may consider an inheritance as marital property in cases such as the following:
- The funds are deposited into a joint account;
- The funds are used to improve the marital property; or
- The funds are commingled in any other manner.
Further, this rule not only applies to cash inheritances but also applies to inherited items such as the following:
An experienced Oregon divorce attorney can help high-net-worth couples navigate this challenging area of the law.
How to Protect Inherited Wealth During a Divorce
High net-worth individuals contemplating a divorce should take steps to protect their inherited wealth. Some steps one can take to safeguard their inherited wealth include:
- Keeping separate bank accounts for inherited wealth;
- Using an expert to identify assets;
- Retrieving copies of all relevant financial statements; and
- Consulting with an Oregon divorce attorney to discuss property division.
Time is of the essence, and the devil is in the details for high net-worth divorces. Thus, contacting an attorney as soon as possible is the best action to protect valuable inherited wealth.
Are You Considering an Oregon Divorce But Are Concerned About Your Inheritance?
Protecting your business is likely one of your primary goals if you are a small business owner considering a divorce. The dedicated Portland divorce lawyers at Gearing Rackner & McGrath, LLP, are dedicated, knowledgeable advocates who understand the complexities that business ownership introduces into a divorce. We have the skill and experience necessary to help put your mind at ease through this challenging time. As a full-service Oregon family law firm, we also handle all other aspects of a divorce, including spousal support, child custody, child support, and paternity matters. To learn more and to schedule a consultation with a lawyer at Gearing Rackner & McGrath today, call 503-222-9116.