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What may happen to a trust in a divorce

On Behalf of | Feb 21, 2017 | Divorce

Virginia residents who are getting married and who are the beneficiaries of a family trust might want to check the terms of that trust to find out its status in the case of a divorce. With a third party trust, even if it is intended only for one individual, the other spouse might have a claim on it.

However, it is possible to set up a trust and specify that it should not be considered marital property or used in calculating spousal support. An individual who is the beneficiary of such a trust should take additional steps to ensure that it is not considered marital property. The beneficiary should avoid commingling any of the assets with a joint account or using the assets to make a joint purchase.

On the other hand, there might be situations in which people setting up a trust want to make certain that a person’s spouse does benefit from it in the case of a divorce. One example might be if parents are close to their adult child’s spouse and the adult child is ill or struggles with addiction. The marriage might end after people spent years caregiving, and the parents might want to make certain that they aren’t left with nothing even if they are no longer officially part of the family.

People who are considering divorce and who have access to a trust or whose spouse is beneficiary to a trust might want to find out from an attorney what their rights are, if any, regarding those assets. The same is true of inheritances received. Generally, these are considered the property of the person for whom the inheritance was left. However, if an individual deposits the money from an inheritance into a joint account or uses it to buy a home or other shared property, it might be considered joint marital property.