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What Are the Penalties for Failure to Disclose Assets During a Divorce?

Contested divorce proceedings involving property and financial assets can get ugly quickly. Each spouse could feel the temptation to hide assets and property from the court to keep the other from winning even a percentage of the value.

Failing to disclose assets in a divorce can have severe legal penalties and can reverse any finalized divorce settlement, forcing both parties back to court.

During a Divorce


Losing Hidden Assets

Angering the judge in your divorce case by hiding your assets is never a smart idea. An irate judge may require you to surrender 100 percent of your hidden assets to your spouse as a penalty for attempting to circumvent the divorce asset division process.

According to FindLaw’s website, state laws may even require the judge to hand over the entire asset to your spouse because of your actions. Surrendering the property doesn’t count towards dividing the rest of your assets in the divorce. This means you stand to lose additional property and assets.


Adjustments to Alimony

The court bases any spousal support agreement in your divorce from you and your spouses’ income levels and assigned assets in the settlement. Failing to disclose to disclose assets in your divorce upsets the balance the court strikes between spousal income and asset assignments.

This may mean the court will need to adjust any spousal support agreement resulting from your divorce. You could end up owing more in required alimony because of your failure to make the court aware of all your financial holdings.


Changes in Child Support

If your divorce involves a custody arrangement with children from the marriage, the court must determine child support payments from a combination of spousal incomes and assets. Failing to disclose assets in your divorce can cause the court to revisit an order for required child support and may result in you owing more money each month.

The court can also backdate an existing order for child support, resulting in an immediate back balance. If you fail to bring this balance current, you could incur significant legal penalties, including jail time and the suspension of professional licenses.


Contempt of Court

A divorce is still a legal proceeding that you must respect even if you can’t stand your spouse. Failing to disclose assets in your divorce and willfully seeking to mislead the judge presiding over your case could result in the judge finding you in contempt of court.

Contempt of court can carry financial penalties and an immediate term of incarceration depending on how egregious the judge finds your particular violation of the law.


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