How Inheritance Affects Alimony and Equitable Distribution in a Florida Divorce

Dividing assets and determining financial support during a divorce can be complex, especially when one spouse has received an inheritance. In Florida, inheritance is generally not considered a marital asset and is not subject to equitable distribution. However, it can still play a role in alimony determinations, particularly when income is generated from the inherited funds.

This blog will break down the key legal principles surrounding inheritance, equitable distribution, and alimony in Florida divorces.

Inheritance and Equitable Distribution in Florida

Florida law follows the principle of equitable distribution when dividing assets and liabilities in a divorce. This means that the court will divide marital property fairly, but not necessarily equally.

Is Inheritance a Marital Asset?

In general, inheritance is classified as a non-marital asset, meaning it belongs solely to the spouse who received it and is not subject to division during the divorce. This rule applies regardless of whether the inheritance was received before or during the marriage.

However, there are exceptions where an inheritance can become a marital asset:

1. Commingling of Funds – If the inherited money is deposited into a joint account or used for joint marital expenses (such as purchasing a marital home or funding shared investments), it may be considered marital property.

2. Transmutation – If the inheriting spouse intentionally or unintentionally mixes the inheritance with marital funds, such as by using it to pay joint debts or improve shared property, a court may determine that it lost its non-marital status.

3. Using Inheritance for Marital Investments – If inherited assets, such as a home, are titled jointly or used as collateral for joint loans, they may be considered part of the marital estate.

If an inheritance remains separate and untouched, it will not be divided between spouses in a Florida divorce.

How Inheritance Can Impact Alimony in Florida

Even though an inheritance itself is not divided in a divorce, income generated from an inheritance can impact alimony calculations. This is because Florida courts consider income and financial resources when determining a spouse's need for alimony and the other spouse's ability to pay.

Alimony Factors and Inheritance Income

Florida courts look at several factors when awarding alimony, including:

• The standard of living established during the marriage

• The financial resources of each party

• Each spouse's income and earning capacity

• The length of the marriage

• The contributions of each spouse to the marriage

While the principal inheritance (the lump sum or property received) is not considered when calculating alimony, income or financial benefits derived from the inheritance can be used to determine support obligations.

Examples of How Inheritance Affects Alimony:

1. Rental Income from an Inherited Property – If a spouse inherits real estate and rents it out, the rental income could be factored into alimony calculations.

2. Investment Dividends – If an inheritance includes stocks or investment accounts generating interest, dividends, or capital gains, that income may be considered part of the inheriting spouse's financial resources.

3. Trust Distributions – If a spouse receives regular payments from an inherited trust, the court may count those payments as available income when determining alimony.

4. Interest Earnings – If an inheritance is placed in an interest-bearing account, any earned interest could be factored into the spouse's ability to pay or need for alimony.

What About Lump-Sum Inheritances?

If an inheritance is received as a one-time lump sum and remains untouched, it typically won't be considered in alimony calculations. However, if the receiving spouse regularly withdraws money from the inheritance for living expenses, the court may view it as available financial resources.

Protecting an Inheritance in a Florida Divorce

If you want to keep an inheritance separate from marital property and limit its impact on financial obligations, consider these steps:

• Keep the Inheritance in a Separate Account – Avoid depositing inherited funds into joint accounts.

• Avoid Using the Inheritance for Marital Expenses – Paying off joint debts or making joint purchases could cause the inheritance to lose its non-marital status.

• Create a Prenuptial or Postnuptial Agreement – A legally binding agreement can specify that any future inheritance remains separate property.

• Maintain Clear Records – Keep documentation of the inheritance, including wills, account statements, and deposit records, to prove its non-marital nature.

Final Thoughts

In a Florida divorce, inheritance is generally not subject to equitable distribution unless it has been commingled with marital assets. However, income generated from an inheritance can impact alimony by increasing the inheriting spouse's financial resources.

If you are concerned about how your inheritance may affect your divorce, working with an experienced family law attorney is crucial. At Family Matters Law Group, P.A., we help clients navigate complex financial issues in divorce, ensuring their rights and assets are protected.

Need help understanding how your financial situation could impact your divorce? Contact us today to schedule a consultation.