How Do Courts Determine If a Spouse Is Undervaluing Their Business or Personal Assets?

Getting divorced can be one of the most frustrating and financially draining events of your life, especially if you feel your spouse is undervaluing their business or personal assets. The court expects both partners to be fully transparent and honest about their finances, particularly if those assets fall under marital property. You may be wondering how the courts determine if a spouse is undervaluing their business or personal assets. As Houston divorce lawyers, C. E. Schmidt & Associates PLLC can help you find out.

When you get divorced in Texas, particularly if your divorce involves significant marital assets, the court has to determine exactly how valuable each spouse’s marital and separate property is. While the court expects each partner to provide an honest accounting of their finances, some people try to hide assets. This is the last thing you should do, and it will only result in being vilified by the court and possibly facing legal penalties.

What Does the Court Look at in a Divorce?

To make a full assessment of both spouses’ finances, the court will look through many different elements, including financial records and witness testimonies. Some of the documents the court will look through include:

• Financial Records: To understand the total value of marital and separate assets each spouse holds, the court will review bank statements, credit card statements, expense reports, receipts, and other available financial records.

• Business Valuations: If you or your partner owns a business, that business may be considered marital property if it meets certain qualifications. The court may assign certain financial and business professionals to conduct valuations and determine the fair market value of that business. If it is deemed marital property, it may be sold off, and the proceeds may be split between partners.

• Professional Witnesses: It is not uncommon for the court to bring in professional witnesses, such as forensic accountants, to analyze the complexities of your finances and possibly uncover hidden assets.

Is It Illegal to Hide Assets in a Divorce?

Yes, it is illegal to hide assets in a divorce in Texas. Texas state law requires full transparency and full disclosure when it comes to marital assets. If the court uncovers that you have withheld assets, you could suffer severe legal penalties that include hefty fines and even jail time. You could end up facing charges of perjury or even fraud.

Contact a Divorce Lawyer Today

Dealing with the financial fallout of a divorce can be difficult. Learning that your spouse has been withholding assets can be frustrating. We can help you make sense of your case and ensure you are not taken advantage of. At C. E. Schmidt & Associates PLLC, we understand the kind of help you’ll need during your divorce.

Our combined 100 years of legal experience can help protect your interests as you navigate your divorce. Reach out to us at 346-517-6906 or contact us online to speak to a valued team member about how we can help your case.