If you are not paying close attention to you and your spouse’s finances leading up to your divorce, during your divorce, and after your divorce, you might overlook hidden assets. It is important to keep an eye on your finances to be sure that you are receiving a fair and equitable divorce settlement. Never is this truer than during a complex divorce or a high-asset divorce. In other words, the more property and assets you have as a couple, the greater the likelihood that one or both of you might be hiding these assets. In order to be vigilant about potential hidden assets in your divorce, you need to be aware of some of the most common ways spouses can attempt to hide assets. 

5 Typical Ways Spouses Hide Assets

While some ways spouses hide assets are not very clever at all, many of them can actually be quite creative, so much so that to the untrained eye, they might make it through the divorce unnoticed. In that sense, you will want to hire a knowledgeable legal team, including a forensic accountant and maybe even a private investigator to verify all financial records. To help sharpen your hunches with regards to hidden assets, here are some typical ways spouses tend to hide assets during divorces:

1. Loans to Family and Friends — Your spouse might “lend” friends or family money with the secret understanding that such funds will be returned after the divorce is finalized.

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When two people elect to end their marriage through the divorce process, one of the most important issues that must be settled is how the couple will divide their marital property. If you are considering a divorce, you have probably considered questions such as, “Who will keep our home?” and, “Will I get a fair portion of our retirement savings?” In today’s world, however, more couples than ever before also have digital assets in addition to physical property, and it is important to know how digital assets are treated in a divorce.

What Are Digital Assets?

While the term “digital assets” may be unfamiliar to you, you probably own many things that would qualify as digital assets. Digital assets include e-books, electronically stored versions of songs, and downloadable content. Most digital property has no physical representation of the property in question. Consider, for example, music stored in your iTunes library or the apps on your smartphone. They do not exist anywhere else in the physical world, so they are classified as digital assets.

When you decide to pursue a divorce, there are many things to consider. You will need to decide on arrangements for your children, whether to ask for spousal support, and which of you will get to keep certain items that you bought together. But, what about assets that are only titled in your name? Do you automatically get to keep those? The answer is more complicated than a simple “yes” or “no” and requires a more complete understanding of Illinois’ laws regarding marital and non-marital property.

Equitable Distribution

According to the Illinois Marriage and Dissolution of Marriage Act (IMDMA), the marital property of a couple going through a divorce must be divided in a manner that is fair and just, not necessarily equally. This standard is known as “equitable distribution,” and it is used in 41 states plus the District of Columbia. Before marital property can be divided, however, the couple—or the court—must determine which assets are considered to be marital property.

When two people get married, they often choose to combine all of their financial interests. They may have joint checking and savings accounts, put both names on loan documents and titles, and generally consult with one another about major purchases. Other couples may elect to keep things more separate. These couples may have joint accounts to be used for household bills and other expenses, but they may also have investments or property held in their own names. Whichever option a couple chooses, a divorce may leave more property subject to division than many people realize.

What the Law Says

If a divorcing couple is able to reach a reasonable agreement regarding the division of property, the court will approve the agreement without much a problem in most cases. If the couple cannot agree, however, Illinois law says that a court has the authority to divide the couple’s marital property in a manner that is equitable and just—not necessarily equally. Only marital property is subject to division in a divorce, and determining what constitutes marital property is the first step of the property division process.

One of the most difficult parts of a divorce can be the dividing of the marital property. Before the work of dividing the assets can even be started, the assets must be assigned a proper value.

How Marital Property Is Handled

Illinois considers all property, with extremely limited exceptions, acquired after the date of the marriage to be marital property. Unless the two sides come to an agreement on their own, the law requires the court to divide marital property equitably in a divorce. This means taking into account all of the relevant factors and dividing the property fairly. It is important to understand that “fairly” does not always mean “equally.”