How Are Trusts Divided in an Illinois Divorce?

 Posted on September 23, 2026 in Asset Division

After decades of marriage, a couple may have trusts that play an important role in their estate or retirement plans. A trust could hold inherited property or other assets that one or both spouses expected to rely on later in life.

When spouses divorce after 50, the way a trust is handled starts with whether the property involved is marital or nonmarital. If you're divorcing in 2026, a Kane County, IL gray divorce attorney can review the trust and help determine how it fits into the couple's asset division.

Is a Trust Marital or Nonmarital Property in Illinois?

The first step in categorizing a trust as marital or nonmarital property is determining what interest, if any, a spouse owns in the trust. Trust assets do not automatically become marital or nonmarital property simply because a spouse is a beneficiary, trustee, or settlor. The trust document, who created and funded the trust, and the spouse's right to control or receive the assets all matter.

Under 750 ILCS 5/503 of the Illinois Marriage and Dissolution of Marriage Act, property acquired during a marriage is generally considered marital property. The law also lists exceptions. For example, property received as a gift or inheritance is generally nonmarital. Property acquired before the marriage is also generally nonmarital.

A trust created and funded by a spouse's parents may remain separate from the marital estate, while distributions the spouse actually receives or property the spouse has the right to control can raise different issues. The trust documents and the source of the property help determine how the assets should be treated.

What Happens if Marital Property in Illinois Was Added to a Trust?

Putting marital property into a trust can create additional issues during a divorce. The court must look at where the property came from and whether it can still be identified.

Illinois law addresses contributions between marital and nonmarital property. If property keeps its identity after being contributed to another estate, it does not automatically change its classification. If marital and nonmarital property are mixed together and lose their separate identities, Illinois law can treat the resulting property as marital.

The marital estate can also have a right to reimbursement when it contributed to nonmarital property. However, the contribution must be traced by clear and convincing evidence and cannot have been a gift.

After a long marriage, tracing property can require going back through years of records. Working with an attorney experienced in gray divorce can help you identify which assets may be marital, trace separate property, and gather the records needed to support your position.

How Do the Terms of the Trust Affect Property Division an Illinois Gray Divorce?

The terms of the trust document play a critical role in determining how the trust is addressed in a divorce. The agreement explains who created the trust and who benefits from it. It also sets the trustee's powers and the rules for distributions.

For example, a spouse who receives regular trust distributions is in a different financial position from someone who has no right to demand money from a trust. A trust created by the spouses themselves can also raise different questions from an inheritance held in a trust created by a parent. This can be particularly relevant when the trust is a major part of that spouse's financial plans after retirement.

How Does Equitable Distribution Apply to Trust Assets in Illinois?

Illinois divides marital property under the equitable distribution system. This means marital assets are divided fairly rather than automatically 50/50.

If property connected to a trust is classified as marital property, the court can include it in the division. However, assets that legally belong to a separate trust are not automatically divided simply because one spouse benefits from the trust. The court may instead consider the spouse's trust interest or distributions when evaluating the parties' overall financial circumstances.

The court considers several factors when dividing marital property. Those factors include the length of the marriage and each spouse's contribution to the marital estate. The court also considers each person's economic circumstances.

Can a Trust Affect Spousal Support in an Illinois Gray Divorce?

Trust income can affect a spousal maintenance decision even when the underlying trust property is not divided between the spouses. Illinois courts consider each spouse's income and property when deciding whether maintenance is appropriate.

The effect of a trust on maintenance can include issues such as:

• Whether the spouse receives regular distributions from the trust
• How much income the trust provides
• Whether the spouse has access to trust principal
• What other income and property each spouse has after the divorce

This can be especially important when spouses divorce near retirement. Trust income can change the financial resources available after the marriage ends.

Contact a DuPage County, IL Gray Divorce Lawyer

Trusts can add another layer to property division when a marriage ends later in life. At Divorce Over 50 - Goostree Law Group, our attorneys help clients address trusts and other financial concerns that come with gray divorce.

Contact a Kane County, IL gray divorce attorney today to schedule a consultation or call 630-634-5050.