Are Gifts Marital Property?

It is normal for spouses to give each other gifts during the marriage. However, when a marriage breaks down and leads to a divorce, what happens to these gifts? It is well-settled in New York that gifts from one spouse to the other during the marriage are marital property subject to equitable distribution. For example, if you gift your spouse jewelry, it is considered marital property, as marital funds were used to purchase the jewelry. Other examples of gifts are real estate and automobiles. It must be noted that it is in the Court’s discretion to award each spouse the proper amount of interest in the gift. For example, if your spouse gave you a diamond ring one year ago, the Court may award each spouse one-half interest in the diamond ring. However, if your spouse gave you a diamond ring fifteen or twenty years ago, the Court may award your spouse a smaller interest in the ring.

As you navigate through your divorce, it is crucial to demonstrate when the gift was given and its value. If you cannot prove that the gift was given during the marriage, your spouse may claim that the gift was given to him/her prior to the marriage, which would be considered his/her separate property.