Divorce requires both spouses to fully disclose their income, assets, debts, and financial accounts. However, some people attempt to conceal property or income to avoid sharing it during the divorce process.
Hidden assets can significantly affect property division, spousal support, and child support calculations. Because of this, it is important to identify and address any attempts at financial deception.
What are Hidden Assets?
Hidden assets are income, property, or financial resources that one spouse intentionally fails to disclose during a divorce. The goal is often to reduce the amount of marital property available for division or to minimize support obligations.
Examples of hidden assets may include:
- Undisclosed bank accounts
- Cash kept outside of traditional financial institutions
- Investment accounts not listed on financial disclosures
- Cryptocurrency
- Valuable collectibles, jewelry, or artwork
- Business income that is underreported
- Deferred compensation or bonuses
- Property transferred to friends or relatives
How Are Assets Hidden?
Some spouses use various methods to conceal wealth, such as:
- Underreporting income. Business owners and self-employed individuals may delay contracts, postpone invoicing, or understate earnings to make their income appear lower than it actually is.
- Overstating debts. A spouse may claim to owe money to friends or family members or exaggerate business expenses to reduce the apparent value of marital assets.
- Transferring assets to others. Some individuals temporarily transfer money or property to a trusted friend, family member, or business associate with the expectation that it will be returned after the divorce is finalized.
- Purchasing valuable items. A spouse may use marital funds to purchase collectibles, precious metals, artwork, or other assets that are easier to conceal than cash.
- Creating secret accounts. Funds may be diverted into undisclosed bank, brokerage, or cryptocurrency accounts that are not listed in financial disclosures.
Warning Signs
Signs that a spouse is attempting to conceal assets include:
- Sudden decreases in reported income.
- Missing financial records.
- Unexplained withdrawals or transfers.
- Unusual business transactions.
- Large purchases that cannot be accounted for.
- Refusal to provide financial documentation.
- New accounts discovered during the divorce.
What is Not a Hidden Asset?
Sometimes assets are accidentally not reported, whether it be because the spouse overlooked them or the lawyer failed to inquire about them. Here are some common things that are not reported but are not necessarily hidden either:
- Points programs for items such as merchandise, airlines, and hotels
- Club memberships
- Season tickets
- Artwork and antiques
- Collections (such as sports cards or coins)
- Stock options
- Tax credits and carryovers
- Health savings account balances
- Savings bonds
Contact Us Today
Divorces often bring about contempt and dishonesty. Is your spouse hiding something?
A Redwood City property division lawyer from The Law Offices of Oliver Gutierrez can assist you with your divorce and ensure assets are split fairly. We can use discovery tools such as depositions and subpoenas to help prove your case. We work hard to protect our clients’ legal rights. Se habla español. Schedule a consultation today by calling (650) 285-1673 or filling out the online form.