Gifts to Spouses Under Michigan Divorce Law

It’s common to engage in the tradition of gift giving with your spouse, other family members, and friends. Birthdays, holidays, retirement, anniversaries, and other special occasions are a way of expressing your love and gratitude for those that you love. As you’re considering divorce, what happens to these presents – especially those that are quite valuable? You’re probably aware that your marital assets may be divided according to the interests of fairness under Michigan divorce law, but the application of equitable principles to gifts isn’t so clear. A lawyer with experience in property division cases can tell you how the law works in your specific situation, but some general information may be useful.

Gifts From Others Are Presumed Non-Marital Assets

The threshold question for property division in a divorce case is whether the item is marital or non-marital. Assets acquired through use of income earned during the marriage are typically considered marital. However, when you receive a gift through an inheritance or the kindness of a person who’s not your spouse, the presumption is that it was intended for you alone. These gifts will generally not be considered by a court when making a property distribution of marital property. Where a gift was clearly given to you and your spouse as a couple, the opposite is true: It would be considered marital property.

Two Tests for Determination of Gifts

Where the status of a gift to one or both spouses is not clear – or where the gift is between spouses – Michigan courts have issued rulings on the matter. The case law shows two tests that a spouse can use to overcome the presumption that a gift is non-marital property:

1. Where the non-recipient spouse can show that he or she contributed to the acquisition or appreciation of a gift, the property may be considered marital and subject to distribution. An example would be where a spouse bought a house or a car for the other’s use, but funds were used from a joint bank account. However, if the purchase was made from funds maintained separately during the marriage, the item would likely be non-marital, unless one party helped with the appreciation of the asset. .
2. If the property is considered non-marital, and the marital assets are insufficient support for the spouse after division, a court may find that the item should be considered marital. The interests of fairness and equity, as required by Michigan law, would support this finding.

Property Division Attorneys Can Help with Gift Issues

While Michigan law on property division is relatively straightforward as it pertains to certain marital property, the treatment of other items – including gifts – can be murky. It’s important to understand how case law applies to various assets, in addition to the statutes on the books. A lawyer with extensive experience in property division matters can explain how divorce laws work in Michigan, and help you understand the tests for treatment of gifts. Attorney Michael A. Robbins has represented many clients in divorce matters, including complex property divisions and high-net value cases. For more information on the specifics of your circumstances, please contact our Bloomfield Hills, MI office. We’re happy to answer your questions or set up a consultation.