Consequences of Dissipating Marital Assets in Texas Divorce

What Is Asset Dissipation?

Asset dissipation in the context of Texas divorce refers to the intentional or reckless depletion of marital assets by one spouse with the intent to reduce the value of the marital estate available for division. This can be a serious legal issue with significant financial consequences for the innocent spouse, and courts take asset dissipation seriously as it undermines the fair division of property between spouses.

Signs of asset dissipation include:

• Unexplained withdrawals or transfers of large sums of money
• Sudden and unusual high-value purchases or expenditures
• Secretive behavior around financial matters or accounts
• Transfer of assets to friends or family members without a valid reason
• Significant cash advances on credit cards or unexplained debt accumulation
• Depletion of joint bank accounts without mutual consent
• Unusual investments or business ventures that are not typically characteristic of the individual

The Court Can Penalize a Person for Dissipating Marital Assets

The consequences of dissipating marital assets in Texas can be severe. If a court determines that one spouse has intentionally or recklessly depleted marital assets, it can significantly impact the property division process.

The court’s primary goal is to achieve a fair distribution of the marital estate. To accomplish this, the court may award the non-dissipating spouse a larger share of the remaining assets to compensate for the lost value.

Dissipating marital assets can also have broader implications. It may affect the calculation of spousal support or child support, as these amounts are often based on the parties' income and financial resources.

Additionally, dissipation can lead to increased legal fees and a more contentious divorce process, creating additional stress and financial burdens for both parties.

Given the potential consequences, it is crucial to consult with an experienced Texas family law attorney if you suspect asset dissipation. Early intervention can be essential in protecting your financial interests.

Proof of Asset Dissipation

Proving intent is a critical element in establishing asset dissipation. While demonstrating the depletion of marital assets is essential, it is equally important to show that the spending or transferring of assets was done with the intent to deprive the other spouse of their rightful share of the marital estate.

The following financial documents can serve as great evidence in establishing asset dissipation:

• Bank statements
• Credit card bills and statements
• Investment account statements
• Tax returns
• Loan applications and documents
• Wire transfer receipts
• Sales receipts

You may also collect the following as evidence of asset dissipation:

• Witness testimonies (that speak to unusual spending or purchases)
• Forensic accounting reports
• Correspondence related to asset transfers

In addition to the financial documents listed above, a spouse suspecting asset dissipation may also want to gather any other evidence that suggests the intentional or reckless depletion of marital assets. While intent can be difficult to prove directly, circumstantial evidence, such as hidden accounts, unusual spending patterns, or transfers to family members without explanation, can be used to establish a pattern of behavior indicative of malicious or reckless intent and secretiveness.

Other evidence of intent can include:

• Emails
• Text messages
• Voice recordings

Our Firm Can Help If You Suspect Your Spouse of Dissipating Marital Assets

The Clark Law Firm offers comprehensive counsel to those involved in a divorce. If you need help addressing suspected asset dissipation, we can help you:

• Collect evidence
• Investigate financial records
• Consult with experts
• Negotiate or litigate a property division agreement
• Protect your rights

Complete our online contact form or call (817) 435-4970 to schedule an initial consultation.