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When is an inheritance considered community property in Nevada?
Anonymous5 views3 answers
My wife and I are divorcing. She received an inheritance from relatives in another country before we were married, and another after we were married. The money was kept in a separate account in this other country. But over the course of the marriage, we used the inheritance to supplement my income--to pay bills, pay rent, pay for living expenses, pay our children's tuition, buy cars, travel, etc. Basically, we used i as a second income to support our lifestyle. She is claiming her inheritance as Separate Property that should not be taken into consideration in any financial agreement. Is she correct, or would her inheritance be considered "Community Property" because she used it to enhance the lifestyle of the "community" and therefore created a support obligation issue?
The general rule is never. There are two ways it could become community property.
First, if the item was specifically left to both spouses it would be community property.
Second, even if the property was left to only one spouse it could become community property through the process of commingling. That would occur where community property was mixed in with the separate property to such an extent that it wouldn't really be possible or practical to continue to call it separate property.
For example, if your wife received money and simply put the inheritance in your regular joint account which you deposited your paychecks into and paid bills out or, it would quickly become impossible to distinguish the community property from the separate property inheritance.
Another example would be if your wife inherited a house and then put your name on it or refinanced it to get equity out and then paid off the refinance loan with community funds.
But the situation you described does not appear to be sufficient to change it from separate property to community property. She would need to put your community money into the inheritance account in order to commingle it.
If she inherited money and put it in a separate account and occasionally used it to pay community bills, pay your community rent, community living expenses or for other expenses the money left in her separate account would not turn into community property. The items she purchased could, however, be considered community property.
But if she bought something outright, like a house or car, she could claim that it was still her separate property since she purchased it with separate property funds. If you were on the deed or title it would support your claim that she had commingled the property and it became community property, but she would certainly have a viable case that it was separate property.
While my practice is more related to inheritance than divorce, I believe that, in addition to the first answer, there is another argument that could be made. While the property does not appear to be comingled, the fact that it has been used to support the community can often be used as an argument when discussing support and how much either party should be entitled to.
Mr. Carr is correct. The answer is "never" absent some act of "transmutation." Transmutation occurs when a party knowingly and voluntarily does something to convert it from its prior separate character to community character. That said, Ms. Houghton's argument has carried some weight within the transmutation context in that one must prove the intent to transmute, and the use for community purposes can be strong evidence if it shows a longstanding pattern of doing so. So, your best bet will be to hire one of us that deal in these sorts of cases where we can review all of the details and give you advice tailored to your particular needs.
