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Should you disclose bonuses during divorce proceedings?

Should you disclose bonuses during divorce proceedings?

Married couples in Indiana have a much greater likelihood of divorcing than couples in other states. Indiana actually has the sixth highest divorce rate in the country, according to data from 2017. Financial hardship is the reason typically given for why spouses decide to ultimately divorce in the area.

There are many avenues to navigate during divorce. In some cases, these proceedings can last for over a year, and a lot can change during that time. Before the divorce is final, one spouse may receive a large bonus from work. The spouse worries about whether the ex has any claim to this extra money. While the answer can be complex and you should consult with your attorney before doing anything during this time, you will usually be better off disclosing the extra income. It may not come into play at all, but it is best to play it safe. 

Is it marital property?

The question fundamentally comes down to whether the court will consider the extra money marital income. Generally, when a couple files for divorce, any assets they acquire afterward is personal property. However, the other party can argue the spouse received the bonus due to work completed prior to the couple filing for divorce. As a result, it may be marital property in this instance. 

For the most part, a one-time bonus will not impact child support and alimony payments. Certain professions, such as hedge fund workers, make most of their income through bonuses. In this instance, the court may decide bonuses should come into play when determining alimony. However, a one-time bonus, such as something one might receive at the end of the year, should not impact alimony because it is not indicative of typical income. 

Avoid hiding assets

One might feel tempted to simply avoid depositing the check until the divorce is final. However, this can come back to haunt a person because if the other party discovers the spouse has held onto checks, then the opposing party may make an argument the individual hid other assets.