During a divorce in California, each spouse has a 50% interest in each piece of community property, which means each spouse has an equal right to ownership for any property earned or gained during the marriage. All community property needs to be split 50-50 based on value, not necessarily individual assets or pieces of property. For this reason, you might find yourself feeling like you need to fight for certain pieces of community property during property division.
What can you do to protect your assets as you go through a divorce? You can’t exactly stake a claim in everything you want, and you certainly can’t intentionally hide assets in hopes that they go unnoticed, but you can plan ahead, get an attorney’s help, and take a few other steps to try to keep your most important property with you when the divorce settles.
Get Documents That Prove Ownership
To start, you should collect documents that prove ownership of important assets and accounts. California only requires you to divide community property, which doesn’t include anything you owned separately before you were married. Look for documents, reports, receipts, etc. that definitively show what assets should be considered your separate property that is not subject to property division.
You’ll also want to find documents and information that show your use or involvement with community property that you think should reasonably become yours through divorce. For example, if you and only you operated and managed your family business, internal documents, statements from employees, and so on could be used to prove your spouse’s disinterest or lack of involvement with the business. In doing so, you and your attorney would be in a much better position to argue why the family business should become your property, not your spouse’s.
Look for such important documents and information before you file for divorce, so you’ll be ready to answer any questions and objections without delay. You’ll also feel more confident about your decision to file for divorce if you have set some of the groundwork ahead of time.
Steps to Take After You File for Divorce
Once you file for divorce, you should keep these extra steps and plans in mind:
- Separate bank accounts: Stop using any joint bank accounts shared with your spouse as soon as you file for divorce if possible. You can speak with your banks and financial institutions to learn how to open an account in your name that only you can access and use. You should do the same thing for credit cards and other financial accounts, too. By separating your finances from your spouse before your divorce finalizes, you can better keep any new debt they accrue away from you while also preventing them from potentially misusing or stealing your assets and income.
- Irrevocable trusts: In some cases, using an irrevocable trust might be the best way to protect certain assets from your spouse during divorce. For example, if you want to make sure that a family car goes to your teenager and not to your spouse who doesn’t even need it, you could get an attorney’s help to transfer the vehicle to a trustee on behalf of your child. In doing so, the car (or any other assets that go through this process) won’t be considered community property because it is property of the trust, not your marriage. At that point, neither you nor your spouse would be entitled to a 50% interest in it.
- Update plans: Even while your divorce is pending, you should think about how your estate plans and retirement plans or accounts will need to be updated once it is over. You can’t make any changes that could affect the divorce while it is pending, but you can think ahead. You might need to update beneficiaries, use a qualified domestic relations order (QDRO) for your 401 (k) plan, and so on.
Finding Hidden Assets
Not every spouse who enters a divorce wants the process to be fair and friendly. Some dishonest spouses try to steal community property by hiding assets in secret accounts, moving finances into joint accounts without proper notification or authority, and literally burying money in the backyard. If your spouse hides or steals assets that should have been considered community property, they are stealing from you!
To protect your fair share of community assets, you should talk to a divorce attorney immediately if you suspect that your spouse might be using unlawful and dishonest means to hide assets and property. Experienced attorneys can use various methods to uncover hidden assets, such as working with forensic financial analysts for high net worth divorces or convincing the court to compel the other spouse to reveal assets through a subpoena. Even if you don’t think your spouse will try anything dishonest during your divorce, you can still benefit from a lawyer’s insight and guidance to present arguments and help form agreements about property division during your divorce.
Call (949) 681-9952 now to connect with Gill Law Group, PC and our Orange County divorce attorneys. We would be happy to tell you more about protecting your most valuable assets during a divorce, as well as what to do next if you think your spouse might try to hide property. Contact us now and ask for a complimentary consultation about your divorce case.