How To Deal With Inheritances and Gifts in Your Separation or Divorce in Ontario!

How To Deal With Inheritances and Gifts in Your Separation or Divorce in Ontario!

What if I told you that you don’t have to share your inheritances and gifts with your former spouse in your separation or divorce?

That’s good news for you!

Hi, my name is Thomas O’Malley.  I’m an experienced family lawyer in Durham Region and the GTA.

In general, you do not include any inheritances or gifts that you received during your marriage in your property calculation in your separation or divorce.

However, there are some important exceptions to this rule.  If you used the inherited or gifted money as part of a down payment to purchase the matrimonial home or made mortgage payments with these funds, you cannot exclude these funds from your property calculation.

If you put your inherited or gifted money into a joint bank account with your spouse during the marriage, Ontario family law provides that each spouse is given 50% of these funds.

Here’s the bottom line with inherited or gifted money: you need to keep this money separate in your own bank account and do not use it make any payments towards the matrimonial home if you want to exclude your gifts and inheritances from your property calculation in your separation or divorce.

If you get an inheritance or gift before the date of marriage, you must account for this amount in your property calculation.  However, you get to deduct the value of your inheritance or gift on the date of marriage from your overall property calculation as long as you don’t put the money into a joint bank account or the matrimonial home.

For instance, let’s say you receive $100,000 as a gift before your marriage and you invest that gift in stocks and bonds.  If your investment increased in value to $300,000 by the date of separation, then the $200,000 increase in the value of your investments must be included in your property calculation.

In contrast, let’s say you received this $100,000 gift during the marriage and invest this money in stocks and bonds.  Your investment again increases in value during the marriage to a value of $300,000 on the date of separation.

You get to exclude this entire $300,000 from your property calculation since you received the gift of $100,000 during the course of your marriage and the increase in value of your investment is from this gift of $100,000 that you received during the marriage.

You also get to exclude proceeds of insurance claims and any compensation or settlement you received as a result of a personal injury legal claim from your property calculation.  

You can see how the issue of property division and property calculation can get quite complicated very quickly in your separation or divorce. 

You definitely need to get the advice of an experienced family lawyer to help you with your property issues in your property case.

If you have any questions about your separation, divorce or family law case and you would like our help, there’s a few ways to contact our office.  

You can leave a message on my Facebook law office page, visit my website at www.canadiandivorcelegaladvice.com, or call me directly at 905-434-8837.  We would be happy to speak to you.

Oh, by the way, did you know you can protect your family law rights and get essential information on settling your family law issues with your former spouse with the daily indispensable family law advice and tips at my FREE Facebook group? 

Click here to find out more: Durham Region Separation and Divorce Legal Support Group

You’ll find the group and join.  

Thanks for watching this video.