Navigating the complexities of property division during a divorce can be challenging, especially when dealing with assets received as gifts. In Iowa, the law provides guidance regarding how gifted property is treated compared to marital assets. Understanding whether a gift remains the sole property of the recipient or is divided in a divorce is important for both spouses. Continue reading for more information and secure the help of an experienced Dallas County property division lawyer today.

What is Legally Considered a Gift?

A gift, in a legal context, is generally defined as a voluntary transfer of property from one person to another without expecting anything of value in return. To constitute a valid gift, three elements must typically be present: intent, delivery, and acceptance.

  • Intent: Donative intent means the donor must have the clear intention to give a gift. The transfer must be genuine and without any conditions or strings attached.
  • Delivery: Delivery requires the actual or constructive transfer of the property to the recipient, which relinquishes the gifter’s control of the property.
  • Acceptance: Acceptance means the recipient must willingly take possession of the transferred property.

Without all three elements, the transfer may not be legally recognized as a gift. Gifts can be given between friends, relatives, or between spouses.

Are Gifts Divided in an IA Divorce?

In Iowa, the division of property during a divorce is determined by equitable distribution. Generally, property acquired during the marriage is subject to division. However, Iowa Code § 598.21 exempts certain types of property from this division, including gifts received by one spouse.

Specifically, gifts received by one spouse, either before or during the marriage, are not subject to property division in an Iowa divorce, given that the gifted property is kept separate and traceable. The spouse who received the gift is generally entitled to retain it entirely. This applies whether the gift was from a third party, like a parent or relative, or from the other spouse.

It is crucial, however, that the recipient spouse can prove the property was a true gift, meeting the legal elements mentioned above. The exempt status can be lost if the gifted asset is “commingled” with marital assets, making it difficult to trace, or if the gift was placed into joint names with the intent to convert it into marital property. For example, if cash gifted to one spouse is deposited into a joint bank account and used for marital expenses, a court may deem it subject to division. The court will consider the circumstances and may still divide gifted property if not doing so would cause an extreme inequity.