3699 Wilshire Blvd. Ste 700, Los Angeles, CA 90010 Mon-Fri 9am-6pm +1-213-387-4508
3699 Wilshire Blvd. Ste 700, Los Angeles, CA 90010 Mon-Fri 9am-6pm +1-213-387-4508

What Happens When Your Adult Child Divorces?

Grandparents adult child divorce

by Los Angeles Divorce Attorney– Charles M. Green

We have all heard stories or perhaps have been a support person for our adult children divorcing their spouses. Many parents, after raising their kids in the best possible manner they know how, and watching them graduate from college, believe that their children’s wedding will be their last financial commitment. However, we have all heard stories of parents financially supporting their children during and after a divorce.

What happens to the money, jewelry, stocks and other gifts given to an adult while married upon divorce? Does property belong to the parents, adult child, spouse or both? Under Family Code §770, “all property acquired by the person after marriage by gift, bequest, devise, or descent” is considered the separate property of the recipient and not subject to division in a divorce proceeding.

A common scenario I often encounter in my family law practice involves a parent providing their son or daughter with a hefty down payment to purchase a home. There is a way for the spouse and parents who contributed the separate property down payment to seek reimbursement.

Family Code §2640(b) states in relevant part that “in the division of the community estate, unless a party has made a written waiver of the right to reimbursement or has signed a writing that has the effect of a waiver, the party shall be reimbursed for the party’s contributions to the acquisition of property of the community property estate to the extent the party traces the contributions to a separate property source. The amount reimbursed shall be without interest or adjustment for change in monetary values and may not exceed the net value of the property at the time of the division.”

Before contributing a down payment towards your child’s new home, parents should consider the following:

  • Make it clear that the funds are a gift to your child alone. For example, the check should not be made payable to both spouses. Parents should also consider writing a “gift letter” advising the lender that the down payment is a gift to your child for which you do not expect repayment.
  • Do not commingle. The parents’ gift should not be deposited into a joint account which holds community funds.

As parents, we must have our time to live our lives as well. We will always help our children, even if they make the wrong choices, yet remember, our productive years may be slipping and it will get harder as the years pass to produce active income.

Charles M. Green is Certified as a California Family Law Specialist through the Board of Legal Specialization of the State Bar of California. He has worked extensively in both financial accounting fields and as a litigation attorney specializing in Family Law Cases. He is also diversely experienced in a number of other legal practice areas of importance to individuals, families, and businesses.

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