Did you receive a gift of money from your parents for Christmas? Do they give you an annual gift up to the maximum allowed without taxation? For example, many parents gift their children $15,000.00 each year. If 10 years later you are going through a divorce, how do you ensure that you are able to identify these gifts as separate property? #1. Put them in an account with nothing else. 2. Title the account “Separate Property” 3. Do not spend the money. 4. Do not spend it and then replace it with other monies. 5. Keep all of the monthly statements as they come in each month.Be aware that interest accumulated in the account may be community property.
If you are married and you have no prenuptial agreement and have not partitioned your assets (post nup) than you are subject to the community property laws of our state. Gifts are separate property and that means that they are not in the community property pot to be divided at divorce. BUT it is your burden of proof to prove that you received the money as a gift AND that you didn’t spend it and that we can trace it and find it. If you want to protect the interest also you should consider a partition agreement (post nup).