How to Get Money Inappropriately Spent During Divorce Returned

Division of assets can be one of the most difficult parts of any divorce, and the situation is worse when your spouse starts spending money or selling marital assets after you've separated but before the divorce is finalized. In the U.S., courts typically take this into consideration when they decide how to divide marital property, effectively compensating you for money spent inappropriately. However, in many states you must notify the court if you intend to claim your spouse improperly spent money during the divorce.^{[1]XResearch source}

Part 1

Part 1 of 3:

Making a Dissipation Claim

1
File notice with the court. Inappropriate spending by a spouse during divorce is known legally as "dissipation" of marital assets. In some courts, if you plan to claim dissipation you must file advance notice with the court.^{[2]XResearch source}
- If your state law requires you to file notice, it also will provide specific deadlines by which you must file your notice if you want to claim dissipation of assets at trial.
- For example, in Illinois you must file advance notice with the court at least 60 days before trial.
- If the discovery process makes this deadline impossible, you can file within 30 days after the date discovery closes.
- Your notice typically must identify the date when the marriage broke down, the property that your spouse dissipated, and the period of time during which this dissipation occurred.
- There usually is a maximum period of time for which you can claim dissipation of assets. For example, even if your spouse had a decade-long affair, you may only be able to claim dissipation of assets for inappropriate expenditures made within a few years prior to the date the divorce petition was filed.
- This period of time may be shorter if you knew or reasonably should have known that the dissipation was occurring.
2
Organize your evidence. Detailed spreadsheets and concrete evidence of inappropriate spending is crucial to meet your burden of proving that your spouse dissipated or wasted marital assets.
- The court will look at the expenditures you note objectively and subjectively within the context of your marriage and relationship as a whole.
- The objective part requires you to prove the amount of specific expenditures using receipts, credit card statements, or other independent evidence of when the expenditures were made and how much they entailed.
- Subjectively, inappropriate expenses typically are those that stand out from the normal expenses made by you or your spouse.
- For example, if your spouse suddenly starts spending exorbitant amounts on entertainment, such as going out to bars or movies far more often than they did during the marriage, these would be expenses you could argue were made inappropriately.
- Courts also look at your spouse selling off marital assets as dissipation. For example, your spouse may start selling furniture or electronics from the house to keep you from having them.
- Well-organized evidence in spreadsheets that are easy to follow and understand can make your points clearly for the judge.
Advertisement
3
Present your case to the court. You will make your dissipation claim as part of your case during your divorce trial. As the person making the claim, you must point to the specific expenditures that you believe were inappropriate.
- You have the burden of proof to establish the specific expenditures, including the amounts and the dates they were made.
- Depending on your state law, you may also be responsible for explaining why you believe these expenses to be inappropriate. Typically this involves showing that they differ from your spouse's normal expenses during the course of the marriage.
- You also can demonstrate that expenses were inappropriate if your spouse was buying gifts or otherwise spending money on an extramarital affair.
4
Listen to your spouse's side of the story. After you've properly raised dissipation, your spouse bears the burden of proving where the money was spent, and that it wasn't inappropriate.^{[3]XResearch source}
- Once you've satisfied your burden regarding the expenditures, the burden shifts to your spouse, who essentially must prove that these expenditures weren't inappropriate under the circumstances.
- Keep in mind that buying gifts or spending money on a paramour is never considered appropriate by the courts. Although you may have separated, it is inappropriate (in the eyes of the law) for your spouse to date anyone until the divorce is finalized.
- However, your spouse may try to present other reasons the expenditures were made. Typically they will lean on the separation, for example by stating that they had just rented a new apartment and had to buy furniture or other items for that apartment.
- Ordinary household expenses, including maintaining and furnishing a new home, usually won't be considered dissipation by the courts.
- However, additional spending money or the purchase of items that aren't necessary for the household may be considered dissipation.
5
Receive the judge's ruling. At the conclusion of the trial, the judge will make a decision on your dissipation claim as part of the ruling on how to divide marital property and assets. If the judge is satisfied that your spouse was dissipating marital assets, this typically will result in you getting a larger share of the remaining property.^{[4]XResearch source}
- Keep in mind that the judge typically isn't going to order your spouse to pay you money back that he or she spent inappropriately during the divorce.
- However, the judge will take those amounts into account when dividing the property, giving you a correspondingly larger share of the marital assets.
- For example, if you had a joint bank account with $20,000 in it, and your state's marital property laws dictate that you are entitled to half of those assets, you normally would be entitled to $10,000 from the joint bank account.
- If your spouse inappropriately spent $5,000 while the divorce was pending, there would be only $15,000 left to split in the account. Without proving dissipation, this would mean you were entitled to half of the money in the account, or $7,500.
- However, if you've proved dissipation of $5,000 to the satisfaction of the court, the court would award you $10,000 of the remaining account balance – the half to which you were entitled before your spouse's inappropriate spending.
6
Consider filing an appeal. After the judge's decision is entered, you have a limited period of time to file an appeal if you don't agree with the decision or believe the judge had divided marital property unfairly under the circumstances.
- Even if you don't have one at this point, you definitely need an attorney's advice if you think you want to appeal the judge's decision.
- Appeals courts use different standards to review the decision, and generally don't reconsider the facts presented at trial.
- Rather, the appeals court will look at whether the trial judge abused his or her discretion in dividing your property.
- Since the appeals process requires extensive written briefing and oral arguments, an attorney's assistance is a must.
Advertisement

Part 2

Part 2 of 3:

Identifying Improper Spending to Claim

1
Scrutinize your spouse's financial disclosure form. Both you and your spouse must complete a financial disclosure form as part of your initial divorce filings. You can use this form as a guide to uncover any inappropriate spending.
- If you have reason to believe your spouse has been dishonest on this form, tell your lawyer immediately. Financial disclosure forms are signed under oath, and dishonesty is perjury.
- Your spouse's financial disclosure form lists all assets, including financial accounts. Compare them to your own records to reveal any possible discrepancies.
2
Make discovery requests for financial records. If you suspect inappropriate spending, your attorney can use the tools of the discovery process to uncover evidence of those expenditures, including requesting production of financial records and account statements.
- Keep in mind that even though your spouse's financial disclosure form may have been accurate at the time it was completed, additional expenditures may have been made since the form was filed.
- Work with your attorney to determine what financial records should be provided through requests for production.
- Your attorney also can send your spouse interrogatories, which are written questions that must be answered in writing under oath.
- Through these interrogatories, your attorney can question your spouse about spending made after you filed for divorce.
3
Take note of when the expenditures were made. In many states, expenditures must have been made after the breakdown of the marriage to be considered inappropriate. Typically this would be the date you filed for divorce, although it may be earlier.^{[5]XResearch source}
- For example, if you and your spouse separated for a period of time before you filed for divorce, the date you separated would be considered the date of the breakdown of the marriage.
- Inappropriate expenditures typically are those that are wasteful, but also could include expenditures your spouse made for someone they are dating, such as gifts or vacations.
- If your state only considers inappropriate spending to be any that happens after the breakdown of the marriage, things can be more difficult to prove, especially if your spouse was the one who initially filed for divorce.
- If your spouse knew they were going to file for divorce long before you did, they could have begun making their move earlier by quietly rearranging accounts and selling off assets. Even if this was done with the intent to deprive you of marital assets, you have little to no recourse.
4
Evaluate your spouse's intent. In some states, you can flag expenditures made prior to the breakdown of the marriage if you can prove that your spouse made those expenditures with the intent to deprive you of marital assets.^{[6]XResearch source}
- This rule benefits you if your spouse was the one who filed for divorce first, particularly if they were planning to do so for awhile before they actually did it.
- However, proving your spouse's intent can be difficult. Typically your attorney will want to depose your spouse and ask him or her questions about why the expenditures were made.
- Depositions are part of the discovery process, and involve your attorney interviewing your spouse under oath. A court reporter produces a transcript of the proceedings for future reference.
- Since it's unlikely that your spouse will say straight out that the expenditures were made with the intent to deprive you of marital assets, your proof must rely on implications drawn from the types of expenditures made and their timing.
5
Consider hiring a forensic accountant. If you suspect your spouse is hiding assets, or if you're dealing with multiple accounts and complex financial records, a forensic accountant can help you zero in on improper spending.^{[7]XResearch source}^{[8]XResearch source}
- A forensic accountant has expertise in both accounting and legal requirements. They will go through your financial records in an attempt to find any hidden assets or inconsistencies in reports.
- If you are familiar with your spouse's normal spending and travel habits, you can compare these to expenditures made during the divorce to determine what spending may have been inappropriate.
- A forensic accountant can analyze financial reports and other documents fairly quickly and uncover any items that seem out of order. They will then present those items to you so you can characterize them in light of what you know about your spouse.
Advertisement

Part 3

Part 3 of 3:

Mitigating the Damage from the Start

1
Open a separate bank account. If you're worried about your spouse draining joint bank accounts or spending money inappropriately, opening a separate bank account in your name only may be the best way to protect your money.^{[9]XResearch source}
- Ideally, you want to open a separate bank account and begin the process of separating finances before you file for divorce. If this isn't possible for whatever reason, you still should open a separate bank account as soon as you can, even if there's not much in it.
- In most states, you are entitled to 50 percent of the money in joint accounts. However, if you're going to pull money out of a joint account, you should do so before you file for divorce.
- If your paycheck is deposited into a joint account through direct deposit, talk to your employer about changing your direct deposit so that your paycheck will go into your new separate bank account.
- Keep in mind that once you've pulled your money out of the joint bank accounts, you'll need to change the information for any bills you intend to continue paying that are set to auto-pay.
2
Cancel joint credit cards. If you have any joint credit cards with your spouse in which you are both listed as primary account holders, you both are liable for the full amount of the debt. Closing these accounts can shield you from liability for debts your spouse runs up.^{[10]XResearch source}
- On the other hand, if you are the only primary account holder but have listed your spouse as an authorized user, contact your credit card company to get your spouse's authorization revoked.
- Likewise, take your name off of any cards for which your spouse is responsible.
- Send letters to banks and financial institutions alerting them to the divorce and stating that you are no longer liable for your spouse's debts.
3
Change your passwords. Any online accounts where your spouse could potentially run up inappropriate charges should be secured with new passwords that your spouse doesn't know and couldn't easily guess.^{[11]XResearch source}
- You also may want to set up a new email address to use for these accounts – especially if you and your spouse had a family email account or your spouse knew your email password.
- If you leave the same email address, your spouse may be able to click the "forgot password" link and set a new password by retrieving the email.
- Keep in mind that if your spouse can still access the accounts online, he or she can undo any of the changes you've made.
- However, take care not to change passwords of marital accounts to which your spouse has an equal claim – this could get you in trouble with the court.
4
Seek an injunction. If you're concerned about inappropriate spending of marital assets during the divorce, you can ask the court to issue an injunction against your spouse that prohibits them from taking certain actions such as draining accounts or selling marital property.^{[12]XResearch source}
- Typically the family court will have a form you can fill out to request an injunction. If you have an attorney, they probably have already asked for one when your petition was filed, but ask to make sure.
- In some states, injunctions are issued as a matter of course when a petition for divorce is filed. In others, you'll have to request an injunction after you've filed your petition.
- The injunction typically lasts until marital assets are divided, either at the trial or on agreement between you and your spouse.
- Once you have an injunction, if your spouse continues to spend money inappropriately, you can present the evidence to the court and your spouse will be held in contempt for violation of the injunction.
Advertisement