Dividing assets during a divorce can be tedious and stressful. But what if you are a gig worker? All of your earnings, including gig work, need to be declared. When you don’t declare earnings from gig work during a divorce, the consequences can be serious. Not being truthful can have both legal and financial consequences. Here’s what can happen.
1. Legal Consequences
Lying about additional income can lead to big legal troubles. You could be held in contempt of court for your actions. Courts require full financial disclosure during divorce proceedings. Hiding income can be seen as contempt, which may result in fines, sanctions, or even jail time in severe cases. Even more seriously, you could be found guilty of perjury. If you submit sworn documents that omit your gig income, you’re potentially committing perjury. Lying under oath is a criminal offense in many jurisdictions.
2. Financial Consequences
Divorce settlements rely on accurate income and asset reporting. If discovered, hidden income could lead the court to reopen the case and re-divide assets, often in favor of the spouse who was misled. If gig income is discovered after a support or alimony amount has been set, you might owe retroactive payments based on the correct earnings. This could include interest and penalties. If the other spouse proves you hid income, the judge may order you to pay their legal fees for uncovering the truth.
3. Impact on Custody and Credibility
Family courts weigh the honesty and credibility of each parent when deciding custody. A proven attempt to hide earnings may damage your reputation with the court and affect custody or visitation decisions. Plus, not reporting income can change your alimony or child support payments. Alimony and child support may be adjusted, so being upfront with your income is essential. Judges often view transparency as a sign of good faith and responsibility. Attempting to conceal money not only risks penalties but can also permanently harm your case.
4. Discovery Tools Can Expose You
Even if you’re paid in cash or use payment apps, Subpoenas can be issued for bank accounts, PayPal, Venmo, Cash App, or freelance platforms like Uber, DoorDash, Upwork, etc. Additionally, forensic accountants may analyze lifestyle vs. reported income. Tax returns (or lack thereof) can also be examined. In other words, it will be very difficult to hide your income. Courts can compare spending patterns with declared earnings, revealing inconsistencies. Once discovered, intentional concealment may lead to fines, sanctions, or even criminal charges.
What You Should Do
If you are going through a divorce, be fully transparent about all income, including gig work. You should keep records and report all earnings accurately. It’s also in your best interest to work with an attorney to make sure your financial disclosures are complete. In the long run this will save you from legal or financial problems.
What Happens When You Don’t Declare Earnings From Gig Work in Divorce? is a post from: Beating Broke, if you enjoy it, please visit us and subscribe to the Feed.
