I used my inheritance to purchase a house for my mother in law. When she moved out years later I put the money into a separate account. My husband and I ate now going through a divorce. He sus he has a right to half the inheritance because when we did some renovations on the house we paid with both of our money. Therefore he says it has comingled and is no longer my money. Any money spent on renos is less than 5% of the total value. Is it worth fighting this?
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An inheritance received during the marriage can be excluded from the calculation of your Net Family Property provided that it can be traced and was not invested in the matrimonial home. It is unclear to me whether the house you initially purchased for your mother-in-law is now the matrimonial home, or whether it is a property that you and your husband maintained after your mother-in-law moved out, but is not your matrimonial home.
Assuming that that the house in question is the matrimonial home, you would not be entitled to deduct your contribution made from your inheritance from the equalization calculation. You would however be able to exclude any monies which can be traced to the separate bank account that you mentioned.
If on the other hand, the house is not the matrimonial home, you may be entitled to deduct the initial contribution you made using your inheritance monies. I strong recommend that you consult with a lawyer as more details are needed to properly advise you.