How to Find Hidden Assets in Divorce

Learn what you can do if you suspect your spouse is hiding income, money, or other assets during your divorce, including what you should look for and how to get help.

By , Attorney · UC Law San Francisco
Updated by E.A. Gjelten, Legal Editor

If your marriage is ending, you may be hoping for an amicable and speedy divorce. After all, if you and your spouse reach a divorce settlement agreement at the outset, you can save money, time, and stress by filing for an uncontested divorce. Even when that's not possible, a contested divorce will go more smoothly when spouses can cooperate and when both of them have all the information needed to reach a fair outcome.

But what if you suspect your spouse is hiding money, bank accounts, or other property from you? This article explains the role of financial disclosures in divorce, where to start looking for signs of hidden assets, and how to get help to uncover the truth.

Why Full Disclosure of Assets Is Important in Divorce

As the saying goes, "Marriage is about love. Divorce is about money." That's not entirely true, as any parents fighting over child custody will tell you. But a couple's finances—income, assets, and debts—play a crucial role in the other important divorce issues:

Without complete and accurate information about their income and other assets, spouses can't participate in a fair negotiating process, and a judge won't be able to reach a fair decision if they go to trial in their divorce.

When Financial Disclosures Are Required During Divorce

When couples are divorcing, most U.S. states require both spouses to submit affidavits (written statements signed under oath) with complete details about their finances, including:

  • income
  • other assets, such as real estate, personal property, bank accounts, retirement accounts, and investments
  • debts and other liabilities (such as obligations to support children from a previous marriage), and
  • expenses.

Typically, these financial declarations must include certain supporting documents like tax returns, and the spouses must file them with the court within a short time after they've started the divorce process. However, the financial disclosure requirements may be waived when both spouses agree to that.

Even in states that don't have a blanket requirement for financial disclosures in all divorces, judges will often order spouses to provide this information—particularly when there's a dispute about child support, alimony, or the couple's property. (More below on how to request missing financial information from your spouse during the divorce.)

Any spouse who refuses to provide the required financial disclosures—or gives incomplete or inaccurate information—can face serious sanctions and penalties.

What To Do If You Suspect Your Spouse Is Hiding Assets

If you have any reason to believe that your soon-to-be ex is hiding assets or withholding any financial information from you, your first step should be to look closely at all of the records that you have access to, such as:

  • tax returns
  • credit card statements
  • statements from joint bank accounts and investment accounts, and
  • loan applications.

Look closely for discrepancies and anything unusual, such as:

  • large withdrawals from bank accounts
  • large purchases that you didn't know about
  • unexplained large deposits to bank accounts
  • unexplained transfers, such as to an unknown account
  • large "gifts" to friends or family members, and
  • payments to family members, friends, or associates that are supposedly for loans you didn't know about.

(More below on what to look for on tax returns and loan applications.)

If you've found anything that confirms your suspicions, you could try asking your spouse about it. After all, people sometimes simply make mistakes or inadvertently leave out information on their financial declarations. But if your spouse continues stonewalling—or you just don't believe you'll get honest answers—it's probably time to talk with a lawyer.

Can a Divorce Lawyer Find Hidden Bank Accounts or Other Assets?

Knowledgeable divorce lawyers—especially those who are certified family law specialists with experience in asset searches—have powerful legal tools for finding hidden assets as part of the "discovery" process in divorce (more on that below).

Experienced family law attorneys also know when to call in other experts to help. Forensic accountants and asset investigation services specialize in conducting hidden asset searches. They know what to look for, how to track down financial records, and how to analyze complicated tax returns and business records to find evidence of hidden assets, including:

  • offshore bank accounts in other countries
  • real estate
  • investments
  • retirement accounts, and
  • trust funds.

Business valuation experts can also help if you believe your spouse has undervalued a family business or professional practice, as a way to keep you from getting your fair share of that asset.

Using the Discovery Process in Divorce to Find Hidden Assets

If you don't believe your spouse has voluntarily disclosed complete and accurate financial information in your divorce, your lawyer can use a formal legal process known as "discovery" to get the information and documents you need. The details vary from state to state, but discovery generally includes the following ways of getting information:

  • Document demands. Your attorney can ask your spouse to produce specific documents, such as tax returns, financial statements, loan applications, and account records.
  • Inspection demands. You can ask to inspect electronic records (like email or text) or property like a safe deposit box or art collection.
  • Written questions called "interrogatories" or "requests for admission." These discovery tools require your spouse to answer certain questions in writing or admit (or deny) specific statements that you believe are true.
  • Depositions. You can require your spouse to appear for questioning under oath in a deposition. Your lawyer may also take depositions of your spouse's accountant or business partner, other witnesses, or your own expert. The deposition, which may take place in your lawyer's office, will be recorded for later use at trial.

A deposition is a particularly good way to get information from a dishonest spouse, because anyone who lies under oath during a deposition can be charged with perjury. This may be just the right kind of pressure your spouse needs to tell the truth about hidden assets. Typically, your lawyer will get and examine as many financial records as possible before deposing your spouse. That way, the attorney can ask pointed questions with those records in hand—and call out any discrepancies.

As part of the asset search and discovery process, you and your lawyer will need to examine a wide variety of financial records including receipts, loan documents, deeds, title records, account statements, stock certificates, subscription agreements, royalty agreements, tax documents, and W-2 forms.

You may already have access to some of these information sources (like tax returns). For others, your lawyer will need to request documents from your spouse or get subpoenas from the court.

Start With Tax Returns

If your spouse typically took care of preparing tax returns (or having an account prepare them), you might not have looked at all the details before signing the returns. Now is the time to closely examine the returns from the past few years, especially the following items:

  • Form 1040: Income from wages. This is where you'll find income from all reported sources, including wages, salaries, tips, business income, unemployment compensation, and Social Security benefits. It will also show interest income (such as from bonds, savings accounts, and certificates of deposit), dividends, capital gains, pension and annuity payments, and distributions (money received) from deferred compensation plans or IRAs. If there were distributions, ask where the money went.
  • Schedule A. Schedule A shows itemized deductions, including any state and local taxes paid on income, real estate, and personal property. These payments may be related to hidden assets located (or income generated) in another state. For example, you may see that your spouse paid property taxes on real estate that you didn't know about.
  • Schedule B. If interest or dividend income exceeds current IRS limits, the sources of that income should be reported on Schedule B. Also, if your spouse has an interest in (or control over) financial accounts or trusts in a foreign country, they should be reported here. If the value of those assets is over a certain threshold, they should also be reported on Form 8938.
  • Schedule C. Schedule C is used to report profit or loss from a business operated (or a profession practiced) as a sole proprietorship. This includes income as a freelancer or independent contractor. The reported sales, expenses, costs of goods sold, and net income will give you an idea of how your spouse's business is doing. It might also reveal your spouse's attempts to use questionable expenses to hide net income—although it may take an expert to understand these financial maneuvers.
  • Schedule E. Schedule E is used to report income or loss from rental real estate, partnerships and S corporations, estates and trusts, and royalties. You might find assets here that you didn't know about.

Most people tend to be relatively honest on their tax returns—at least when it comes to reporting income—because they know the penalties for failing to do that can be harsh. At the same time, tax laws are complicated, and people with the money to get expert advice often take advantage of every possible tax loophole and accounting maneuver. That's why it's important to consult a tax advisor or lawyer (or both) if there are any complicated tax issues in your divorce.

Loan Applications and Financial Statements

Before approving a loan, a lending institution will ask for a completed application, copies of recent pay stubs, account records, and a signed declaration regarding all assets and debts. In addition, your spouse may have submitted a personal financial statement to a lender.

Look for discrepancies between the information on these documents and tax returns or financial affidavits in your divorce. People are less likely to omit assets and income (or overstate losses, debts, and liabilities) on loan documents, because that would hurt their chances of getting the loan.

Trace Accounts and Cash Flow

Your attorney or accountant may find hidden assets by tracing accounts and cash flow (all money in and out) during the marriage. To perform a complete tracing, you'll need records for all accounts under one or both spouses' names (whether held alone, jointly, or with a third person). This includes savings, checking, brokerage, trust accounts, and any other accounts used by either spouse during the marriage.

Get copies of canceled checks and ask for copies of wire transfer documents, including authorization forms and wire instructions, to see if your spouse authorized any major transactions you weren't aware of. Find out where the funds went. Did your spouse set up another personal account that holds a stash of cash? Did your spouse "gift" money to a relative or friend that will be returned after the divorce is final? Did your spouse move money into a joint account with a third party? Tracing is a great way to uncover hidden assets.

Search for Hidden Bank Accounts

Your attorney may be able to obtain a subpoena (a written request issued by the clerk of the court) to any financial institution where you suspect your spouse has an account. In response to a proper subpoena, the bank or other institution will have to produce all records associated with your spouse's name.

Review account records carefully. Search for transactions into and out of known accounts. Look for unfamiliar account numbers. For example, if you find a large transfer into or out of your spouse's account, check to see where the money came from or went. Banks typically list the name of the sending and receiving institutions and the last four digits of all accounts. If you find an unfamiliar account, you may have discovered a hidden asset. Follow up with a subpoena for records to that bank as well.

What Can You Do About Hidden Assets Discovered After Your Divorce?

If you learn about hidden assets after your divorce is final, you might think it's too late to do anything about it. But that's not necessarily the case. Depending on the laws in your state and how long it's been since the court issued your divorce decree, you might be able to reopen your divorce or have it set aside based on fraud or misrepresentation. That may be possible even when your divorce decree was based on your settlement agreement, if you signed that agreement as a result of your spouse's fraud or misrepresentation.

Getting Help With an Asset Search and Discovery

When couples are transparent and cooperative, they can often handle their own divorce rather than hire lawyers. But if you're dealing with a spouse who's hiding assets, you should at least speak with a lawyer. Legal discovery is a complicated process that requires knowledge of court procedures, rules of evidence, legal strategies, and best practices. An experienced family law attorney should be able to evaluate your situation, advise you on the best way forward, bring in qualified experts when that's needed, and conduct a thorough discovery process. A lawyer can also explain whether a judge in your state could order your spouse to pay your attorney's fees and other costs related to uncovering hidden assets.

When you're meeting with potential lawyers, be sure to ask about their experience with asset searches, along with the other important questions to ask before hiring an attorney.

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