Inheriting Equity from Living Trust as non community propert

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kikie
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Joined: Sat Apr 09, 2011 4:37 pm

Inheriting Equity from Living Trust as non community propert

Post by kikie »

Inheriting Equity from Living Trust as non community property...

Hello.

A family member and I stand to sell our old family home, that is now in a living trust as 50/50 beneficiaries.

The other family member is married, apparently happily.

Would it still make sense, when they inherit the large amount of equity, that they create and maintain an account in ONLY their name, in case they ever were to divorce, to keep the money are their own inheritance? and NOT community property by mingling it in a joint account ?


Thank you
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chaz
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Re: Inheriting Equity from Living Trust as non community pro

Post by chaz »

Keep it in a separate account, tho might create problem with the spouse.
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SnapShots
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Re: Inheriting Equity from Living Trust as non community pro

Post by SnapShots »

Once you intermingle the money in a joint account, it becomes shared property. If you get a divorce you will have to divide it per your states divorce laws. In mine, it's 50/50.

I would keep the money separate. You can purchase things to use jointly and your spouse can enjoy the benefits of your inheritance. By all means, keep it separate as much as possible.
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bsteiner
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Re: Inheriting Equity from Living Trust as non community pro

Post by bsteiner »

Whether inheritances are subject to equitable distribution (division) upon divorce varies from state to state. Even if it's not subject to equitable distribution on divorce, or you don't get divorce, there's a chance you could (i) do well and have a taxable estate, (ii) have a creditor problem, or (iii) outlive your spouse and remarry. If your parents (or whoever is leaving you the assets) provide for you in a trust (in which you have effective control) rather than outright, your inheritance will not be included in your estate, and will be better protected against your creditors and spouses.
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