Going through a divorce can be one of the most difficult and stressful times in your life. Even couples who agree to end their marriage may find that they have major disagreements as to the settlement terms of the divorce.
Finances are a likely cause of discord both during the marriage and during the ending of the union. It can be tempting for some partners to try to hide assets if they feel that the distribution of assets won’t be fair in their eyes.
It is never right to hide assets and doing so comes with consequences if found out. It is important to make sure that you gather financial documents and information to ensure that you have a full understanding of your assets. An experienced Crystal Lake divorce lawyer will guide the process and help make sure that you obtain a fair and equitable settlement.
Equitable Distribution
Illinois is a state that utilizes equitable distribution to divide assets between divorcing parties. Illinois is not a community property state. Everything that a couple purchased or acquired during the marriage is considered marital property and must be divided in an equitable manner upon divorce. It is helpful to know that equitable distribution doesn’t mean the same thing as equal.
Couples should work together and through their attorneys to come to decisions on how to best divide property and assets that they acquired after they wed. There are several exclusions to the rule. Property that you owned before marriage, gifts that you received, and inheritances, are yours alone and are not to be included when considering the marital property.
How Spouses Hide Assets
Finances are often in dispute as couples separate and head towards divorce. It is not uncommon to learn that a spouse has made an attempt to hide assets so they do not become part of the equitable distribution of property. By hiding assets, the spouse may feel that he or she is entitled to more than a fair share. There may be a feeling that the divorce will leave them without the funds they need and therefore, they may take it upon themselves to grab some of the assets for themselves first.
- Putting Assets Under a Child’s Name
One of the ways that a spouse may try to hide assets is by signing them into the name of a child. That way, the parent will have access to the funds but they won’t show up as part of the marital assets.
- Tax Withholdings
A spouse may make changes to their tax withholding so that their current paychecks are lower. This means that they may not be forthright in providing the correct salary information. The spouse may also receive additional income or benefits from the company that is not included in their pay stub detail.
- Offshore Accounts
Offshore accounts are another way to keep money away from a spouse. These accounts may be difficult to locate. However, in some cases, the bank or institution is required to provide details to the IRS. A spouse may open a new account where they can transfer funds or have money deposited directly.
- Lending Money to Family Members
A person could give money to a family member or friend under the guise of a loan. In reality, the relative is holding the money for the spouse until the divorce is settled. At that time, they will return the money and therefore avoid consideration as marital assets.
- Making Purchases
A spouse who knows that divorce is imminent may suddenly make large purchases either for their own use or as gifts to others. The money will no longer be part of a bank account and the spouse may fail to disclose the item as marital property.
Is Hiding Assets Illegal?
Lying about your assets is not only morally wrong – it is also illegal. Divorce is a civil procedure. As part of the process, both parties must state that the information they provide and the answers they give are true. You must swear that the financial information you give is completely truthful.
If someone is found to have lied under oath such as in a financial affidavit, they could face a variety of consequences for criminal wrongdoing. The judge will not appreciate someone who lies to the court. As a result, the judge could find the person in contempt of court, which will carry some penalties.
In addition, the judge will find it difficult to believe you because you now have a credibility problem. The judge could make adjustments to the settlement to account for the improper behavior.
Financial Disclosure
Generally, spouses must fill out and submit a financial disclosure form as part of the divorce process. The financial disclosure form is a legal affidavit that provides details of your finances. The Illinois Marriage and DIssolution of Marriage Act requires financial disclosure when a party requests child support, spousal maintenance, college expenses, or attorney fees. Typically, financial disclosure is necessary for any requested divorce hearing. In addition to the form, each party must also provide supplemental documents to support the information such as tax returns, pay stubs, bank statements, and more. Your attorney will review the disclosure to ensure a fair and equitable settlement.
Finding Hidden Assets
Complete financial disclosure is necessary to begin to determine whether a spouse has tried to hide assets. A knowledgeable attorney or accountant will review the details of the information to find any inconsistencies in the data. As a marriage partner, it is helpful to know about your marital finances in detail.
Make sure you have a list of all your bank accounts, investments, and property so you can more easily discover a discrepancy. Obtain current information at the time of your separation so you can find out whether your spouse improperly removed funds.
Assets have paper trails and your attorney and divorce team will be able to locate the information through investigation. It is important that you receive a fair and equitable settlement in your divorce. If you think that your spouse might be hiding assets, don’t delay. Contact our divorce attorneys in Crystal Lake at Bruning & Associates to review the case to find out the truth. Call the legal team at Bruning & Associates at (815) 455-3000 today.
