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Divorce Issues: Hidden Assets

One of the most contentious issues in most divorces is the distribution of property. While Texas upholds the principle of community property, the law still has exceptions. The line between separate and communal property can become blurry.

Community property does not only pertain to physical possessions. All the assets that both spouses have accumulated and acquired during the marriage. A spouse may try to hide certain assets to avoid its division.

How to Discover the Hidden Assets

Methods to divulge assets ensure fair and equitable distribution of community property. In the state of Texas, a divorce petitioner can use the following:

Local Disclosures

Local family courts require that both parties openly disclose their paychecks, bank statements, tax returns and also an inventory and appraisal. Notarization and verification of inventory is necessary and should include all property including all the assets and debts. Current statements will be the basis of the judge when they make the final distribution of property.

Written Discover

There is also a discovery process that involved sending the other party a written request for certain documents. The requests can cover all possible documents dating back to the date when the marriage began. This includes all the documents in local disclosures. It also includes their histories on Paypal/Venmo or other payment mediums, HSA accounts, stocks, and bonds.

From the documents collected, divorce lawyers can determine if there are discrepancies and possible deceptions. If there are possibly significant hidden assets, it could be worth hiring a forensic accountant. He can scrutinize the documents and see if the paper trail leads to other assets.

What if you find hidden assets?

If there are hidden assets that the other spouse attempted to conceal, then they can be presented to the court. The judge can penalize the deceptive spouse in many ways. He can declare hidden assets as community property and divide them equitably. He can also decide in favor of the innocent spouse.

The judge can choose to award all the hidden assets to the other spouse to “punish” his/her attempt to deceive the court. The judge can also find the guilty spouse in contempt of court, and order him/her to pay additional damages and/or the legal fees of the other spouse. 

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Mr. Hutton is a Divorce and Custody Lawyer based out of Round Rock, TX. His background is with child psychology at Arizona State University where he received a B.S. in 2006, and he continued this by working with the Children’s Right’s Clinic at the University of Texas School of Law where he received his J.D. in 2009. Throughout his practice, he has been a strong proponent of utilizing modern technology to improve his practice and the representation of his clients. He currently is the technology chair of CAFA of Travis County and is committed to improving and modernizing the practice of law in Texas. If you have any questions you can contact him at

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