Illinois Divorce Laws on Inherited Money

By Elizabeth Rayne, J.D.

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Failing to understand the laws surrounding property division may cost you your inherited property following a divorce. Whether or not an Illinois divorce court will divide an inheritance between the parties comes down to whether the inheritance is considered non-marital or marital property. Generally, inheritances are non-marital property as long as they are maintained separately from marital property.

Non-Marital Property

Courts in Illinois will divide only marital property in a divorce proceeding; non-marital property remains with the spouse who owns it and will not be affected by the divorce. Marital property is generally all property acquired during the marriage. Property owned before the marriage, and gifts and inheritances acquired during the marriage, are considered non-marital property as long as the bequest was clearly made to only one spouse.

Property Division Overview

When it comes to property division, Illinois is an equitable distribution state. If a divorcing couple cannot come to their own agreement about how to divide their marital property, courts will divide it equitably. To determine how to fairly divide the property, the court considers a number of factors, including the length of the marriage, how much each spouse contributed to the marital property and the financial resources of each spouse. Illinois courts also have discretion to set aside certain property in a trust to provide financial support for minor children.

Transmutation and Commingling

Non-marital property may be converted by the parties into marital property, which then may be divided by the court as part of a divorce. Generally, the court will not consider property to be non-marital if it loses its identity as separate property. For example, if a couple refinances a house that one spouse owned before the marriage and both their names are placed on the title, the home is converted - or transmuted - into marital property. Another way for property to lose its separate identity is through commingling, where the non-marital property is no longer separate from marital property. For example, if a spouse places inherited money into a joint bank account, that money becomes commingled with marital property.

Burden of Proof

In Illinois, courts will assume that all property is marital property, unless one spouse provides evidence otherwise. If you have inherited property, you have the burden of providing clear and convincing evidence that you received it as an inheritance and that it has not been transmuted to marital property. For example, a spouse may provide evidence of a will that granted him the property in question. He will also need to show that he retained complete control and ownership over the inheritance, proving that it was not commingled with marital property.