WE RESPOND TO YOUR NEEDS 414-271-1440
How Can I Address Wasted or Destroyed Assets During My Divorce?
Attorney Paul S. Crawford, Family Law Attorney at GRGB
In a divorce, the division of assets is often one of the most contentious issues. All of the property a couple owns must be valued and divided. Likewise, there needs to be a determination on who will be responsible for paying the debts the couple owes.
During this process, one spouse may find that the other has wasted or destroyed shared assets. This can seriously hurt the other spouse's finances. They may be left with little money and unexpected debts that must be repaid.
When one spouse takes actions that reduce the value of the marital estate, it's called "dissipation of assets." If you're going through a Wisconsin divorce, our Milwaukee family law attorneys can help you work towards a fair share of marital assets, including any that have been wasted.
Dissipation of Assets Under Wisconsin Law
Under Wisconsin law (Wis. Stat. § 767.63), assets that have been dissipated are known as "disposed assets." This law covers assets worth at least $500 that were removed from the marital estate because they were wasted, transferred, given away, or otherwise unaccounted for within a year of filing for divorce. Those assets are automatically considered part of the marital estate.
This is because Wisconsin is a community property state. Under Wisconsin's Marital Property Act, most assets acquired during a marriage are considered equally owned by both spouses. When one spouse wastes marital property without the other's knowledge or consent, the law views that as effectively taking from both spouses.
As a result, the court treats those wasted assets as though they still exist and factors them into the overall property division, which means the spouse who dissipated assets may receive a smaller share of what remains.
Common Examples of Asset Dissipation in a Wisconsin Divorce
Dissipation doesn’t usually look like one angry instance of breaking things or just one crazy weekend in Vegas. More often, it happens gradually over months or even years. If a spouse is smart about it, dissipation can be easy to miss without a careful review of financial records.
Common examples of marital dissipation include:
- Gambling with savings or retirement funds
- Spending money on an extramarital relationship, including gifts, travel, or housing for a boyfriend or girlfriend
- Selling or giving away property — such as a vehicle, jewelry, or collectibles — for far less than its value or for nothing at all
- Transferring money to friends or family members to keep it out of the divorce
- Running up joint credit card debt on personal purchases that benefit only one spouse
- Deliberately damaging or destroying property, such as a vehicle or home, to reduce its value
- Draining a joint bank account shortly before or after filing for divorce
- Cashing out retirement accounts and spending the proceeds
Not every large purchase or financial decision qualifies as dissipation. If money was spent on reasonable household expenses, children, or legitimate bills, that is unlikely to meet the legal standard. The primary question a judge will want to answer is whether the spending was wasteful, one-sided, and harmful to the marital estate. This is especially true if it happened close to the time of separation or divorce filing.
How Do You Prove Dissipation of Assets in Wisconsin?
Courts don’t just take one spouse's word for it when it comes to accusations of dissipation. The burden of proof is on the spouse making the claim to show that dissipation occurred. That means you’ll need financial records and to present them in a way that clearly shows or suggests what happened.
Useful evidence in a dissipation claim can include:
- Bank account statements showing large or unexplained withdrawals
- Credit card statements reflecting purchases that benefited only one spouse
- Tax returns and pay stubs that reveal income inconsistencies
- Property appraisals showing that assets were sold or transferred below market value
- Text messages, emails, or other communications referencing the transfer or disposal of property
- Receipts or financial records tied to an extramarital relationship
Your attorney can help you request financial documents through the discovery process, the formal legal procedure that allows each side in a divorce to get information from the other.
If one spouse has tried to hide assets or financial activity, a forensic accountant may be brought in to trace where money went and reconstruct a fuller picture of the marital estate.
What Happens if the Court Finds One Spouse Dissipated Assets?
If the court determines that one spouse dissipated marital assets, the judge can adjust the property division to make up for what was lost. In practice, this often means the spouse who wasted assets gets a smaller portion of the remaining marital property. This might mean getting a greater share of retirement accounts, equity in a home, or any other assets.
Wisconsin courts do not automatically punish a spouse for dissipation — the division still needs to be equitable overall — but a well-documented dissipation claim can meaningfully shift the outcome of a property division in your favor.
The goal is to put the other spouse in as close a position as possible to where they would have been had the dissipation not happened. In cases of extreme dissipation, this isn’t always possible. If you think your spouse may be wasting assets, and you are fairly certain your marriage is ending anyway, the sooner you act, the better. Courts have more tools when there are more assets to work with.
Contact Our Experienced Milwaukee County Divorce Lawyers
If you suspect that your spouse has wasted or destroyed marital assets during your marriage, you should work with a lawyer right away. The knowledgeable Milwaukee property division attorneys at Gimbel, Reilly, Guerin & Brown, LLP can help you figure out whether your spouse wasted assets according to Wisconsin law. If so, we will advocate for a fair division of marital property that will allow you to meet your financial needs.
To learn more about how we can help you with handling financial concerns and other legal issues during your divorce, contact us at 414-271-1440 to schedule a complimentary consultation.
