Can I Keep the Gifts I Receive During My Marriage in a Divorce?

In a marriage, almost everything is shared between spouses, including a bed, bank account, children, and home. However, depending on the specifics of the circumstances some assets may be considered separate property in a divorce. Whether or not you can keep the gifts you receive during the course of your marriage in the divorce process depends on a variety of factors. Work with a skillful Oakland County property distribution lawyer for experienced legal advice and representation.

Are Gifts Considered Marital or Separate Property?

Whether gifts are considered marital or separate property generally depends on the jurisdiction you are in. In Michigan, gifts that you were given before or during your marriage are typically considered separate property, given that certain circumstances apply.

If you can prove that the item or property was a gift by identifying the source and proving that you kept it separate during the marriage, a gift could be considered separate property.

However, even property that started off separately has the capacity to become jointly owned over time. For example, if a house was gifted to you but your spouse contributed to the home financially or through maintenance, it can be considered marital property during a divorce. In addition, if you were gifted money but placed it in a joint account, it will likely be considered joint and subject to property division.

Can I Keep the Gifts I Receive During My Marriage in a Divorce?

The answer to this question depends on the details of the situation. Michigan operates under an equitable distribution system during divorce, meaning that property acquired by either spouse during the marriage is generally considered jointly owned and subject to a fair distribution between parties. However, gifts and inheritance can be an exception to this rule.

You can keep the gifts you were given during the marriage if you keep detailed records proving that the property was given to you specifically and that you did not commingle the asset. Retain records demonstrating when and how you were given the gift. Place any gifted assets in a separate account or maintain them using separate funds. Do not add your spouse’s name to any gifted property and pay property or income taxes on the gift using separate investments.

Market appreciation can also have an impact on property division. In Michigan, an asset’s increase in value over time may be considered marital property even if the original gift remains separate property. For example, if you manage to keep a home that was gifted to you separate from your marital property, you can keep the house in the divorce. However, if the property’s value increased due to inflation, demand, location, etc. the monetary value of the increase could be considered marital property and subject to asset distribution.

Property division is an extremely important but complex factor in a divorce so it is crucial that you understand your legal rights and options. Enlist the help of an attorney at Alan B. Cooper & Associates, PLLC today.