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Thinking of hiding your assets in a Texas divorce? Think again

On Behalf of | Sep 24, 2021 | Property Division

Texas is one of the few community property states in the nation, so almost everything a couple acquires during their marriage is subject to division in a divorce.

That may not really seem fair to you, especially if you were the person in your marriage who carefully cultivated your nest egg while your spouse ran up the bills. A couple of your friends or relatives have quietly suggested that you “forget” to list some of your more obscure assets on your financial disclosure forms.

Hiding assets in a Texas divorce is a very bad idea

It’s a lot harder to conceal money and assets than you might think. Paper and electronic trails are everywhere. A good forensic accountant can sniff out almost anything you seek to hide.

Chapter 7 of the Texas Family Code considers hiding assets in a divorce a “fraud on the community.” Not only is this a crime (which means you could face charges and end up with a criminal record), but there are also serious repercussions when it comes to how your property will ultimately be divided.

First, the court will “reconstitute the estate,” which means it will determine what the value of the marital property would have been had the fraud never taken place. Then, the court has several options, including:

  • They can award your spouse or ex-spouse an appropriate share of the assets 
  • They can award your spouse or ex-spouse a monetary judgment 
  • They can give your spouse or ex-spouse both their fair share of the assets and a monetary judgment

In other words, you could end up losing everything you hoped to save — or more. 

Don’t make a critical mistake in your Texas divorce out of uncertainty, misinformation or fear. There may be legitimate ways to protect much of what you have, and you need to explore them.