You and your spouse are moving toward divorce, and you know you’ll have to divide your financial assets during property division. You’re worried this will give your spouse a chance to take a portion of the assets you consider yours, such as the money you’ve earned. Furthermore, California is a community property state, so you know that the court attempts to find a solution where assets are divided evenly between divorcing spouses.
What you’ve been considering is simply removing some assets from your name before property division. For instance, you might transfer ownership of a bank account to your brother or father. They would then own those assets, so they wouldn’t go through property division, and 50% of them wouldn’t be given to your soon-to-be ex. After the divorce concludes, your brother or father could transfer ownership back to you, allowing you to keep the entire balance of the account.
Hiding assets is prohibited
Many people try to do this, but it’s illegal to hide assets. From a legal standpoint, the discovery process is one of the first steps in a divorce. At this time, both you and your spouse must disclose the assets you own to the court.
If you transfer money out of your name shortly before the divorce and fail to disclose it, the court may examine your financial documents and transfer activity and find the money anyway. You could then be accused of illegally hiding assets and committing fraud by submitting improper disclosures to the court.
It’s important to avoid these types of common mistakes. That said, your divorce could still become contentious, and you need to understand all the legal options available to protect your assets.