Dissipation of the Marital Estate in Illinois: What It Is and How Courts Handle It

When you are going through a divorce in Illinois, one of the most important and emotionally charged issues is dividing property and debts. Illinois follows the principle of equitable distribution, meaning the court divides marital property in just proportions rather than necessarily splitting everything fifty-fifty.

But fairness can be threatened when one spouse secretly spends, transfers, or wastes marital funds for personal use during the breakdown of the marriage. In Illinois, this is called dissipation of the marital estate. Dissipation can dramatically alter the outcome of property division, and understanding what it means—and how courts handle it—is crucial if you are navigating a divorce or considering filing one.

Understanding Marital and Non-Marital Property in Illinois

Before you can understand dissipation, you must understand what constitutes marital property. Under 750 ILCS 5/503(a), marital property includes nearly all property and debts acquired by either spouse after the date of marriage and before a judgment of dissolution, unless it qualifies as non-marital property.

Non-marital property includes:

• Property acquired by gift or inheritance.

• Property acquired in exchange for property owned before the marriage.

• Property excluded by a valid premarital or postnuptial agreement.

• Property acquired after a judgment of legal separation.

• The increase in value of non-marital property.

Under 750 ILCS 5/503(b), all property acquired by either spouse during the marriage is presumed to be marital property. This presumption can be overcome only with clear and convincing evidence that it was acquired through one of the exceptions listed above.

The reason this distinction matters is that only marital property can be the subject of a dissipation claim. You cannot claim dissipation for property that legally belongs only to one spouse and is classified as non-marital.

What Dissipation of the Marital Estate Means

The Illinois Marriage and Dissolution of Marriage Act directly addresses dissipation in 750 ILCS 5/503(d)(2). This section states that when the court divides marital property, it must consider “the dissipation by each party of the marital property.”

Dissipation occurs when one spouse uses marital property for their own sole benefit for a purpose unrelated to the marriage at a time when the marriage is undergoing an irretrievable breakdown.

In plain English, dissipation means that one spouse wrongfully spent or wasted marital funds after the marriage had already started falling apart. For example, one spouse might:

• Spend large sums of marital money on a new romantic partner.

• Use joint credit cards for personal entertainment or gambling.

• Transfer marital funds into secret bank accounts.

• Sell marital property and keep the money.

• Make luxury purchases for themselves after separation.

Dissipation is different from normal spending. Using marital funds to pay the mortgage, buy groceries, or cover family expenses is not dissipation because those expenditures benefit the family. The key question is whether the spending was solely for one spouse’s personal interest and unrelated to the marriage.

When the Marriage Is Considered to Be “Undergoing an Irretrievable Breakdown”

A critical element of dissipation is timing. The spending must occur when the marriage is in the process of breaking down. Illinois law does not define an exact date or formula for determining when this occurs. Instead, courts look at the facts of each case.

Common indicators that a marriage has reached this point include:

• The spouses have separated or no longer live together.

• They have stopped cohabiting as a married couple.

• They maintain separate finances.

• There is no realistic chance of reconciliation.

Spending that takes place before the breakdown—while the couple is still functioning as a marital unit—is typically not dissipation. However, once it is clear that the marriage is failing, personal use of marital funds may qualify.

Because this is a factual issue, your attorney may need to present evidence showing when the marriage began to deteriorate. The court will then decide whether the timing of the spending falls within the “breakdown period.”

Procedural and Time Requirements for Dissipation Claims

Illinois law has very specific rules about when and how a dissipation claim must be raised. These procedural safeguards are designed to give both parties notice and ensure fairness. Under 750 ILCS 5/503(d)(2):

1. Notice of Intent to Claim Dissipation: A party claiming dissipation must serve a written notice of intent no later than 60 days before trial or 30 days after discovery closes, whichever is later.

2. Content of the Notice: The notice must include the date or period during which the marriage began undergoing an irretrievable breakdown; identification of the property or funds alleged to have been dissipated; and the date or time period during which the alleged dissipation occurred.

3. Service of Notice: The party must file a certificate of service with the court clerk showing that proper notice was provided under the applicable procedural rules.

4. Timing Limits on the Conduct Itself: No dissipation shall be deemed to have occurred prior to three years after the party claiming dissipation knew or should have known of it, and never prior to five years before the filing of the petition for dissolution of marriage.

These deadlines are mandatory. If a party fails to provide timely and specific notice, the court will not consider the claim.

How Dissipation Affects Property Division

When a court finds that one spouse has dissipated marital property, it does not impose a fine or criminal penalty. Instead, the court adjusts the division of marital property to compensate the other spouse for the loss.

Illinois courts divide property in just proportions under 750 ILCS 5/503(d). This means that the court considers multiple statutory factors, such as:

• Each spouse’s contribution to acquiring or preserving property.

• The dissipation by either spouse of marital property.

• The value of property assigned to each spouse.

• The duration of the marriage.

• The relevant economic circumstances of each spouse.

• Any valid premarital or postnuptial agreement.

• Each spouse’s earning potential, age, and health.

• The tax consequences of the property division.

When dissipation is proven, the court may assign the value of the dissipated property to the spouse who wasted it, effectively reducing their share of the marital estate. For instance, if one spouse used $50,000 in marital funds for non-marital purposes, the court could adjust the distribution so the other spouse receives $50,000 more in marital assets.

Proving or Defending Against Dissipation

The spouse claiming dissipation bears the initial burden of alleging it with specificity. Once a proper notice is filed under Section 503(d)(2), the burden shifts to the accused spouse to show that the money or property was used for a legitimate marital purpose.

Evidence is essential. Bank statements, credit card records, receipts, and transaction histories often reveal how funds were used. The court will look at whether the expenses benefited the marriage or were personal in nature.

To defend against a dissipation claim, the accused spouse must provide documentation showing that:

• The expenditures served a family or household purpose.

• The spending was reasonable given the circumstances.

• The timing of the spending occurred before the marriage began breaking down.

During the discovery process, financial documents are exchanged under Illinois Supreme Court Rules 201 and 214, which govern discovery procedures and document production. These rules give both sides access to financial records that can help establish or refute a dissipation claim.

Preventing Dissipation During Divorce

If you believe your spouse might dissipate marital assets during the divorce, you can ask the court for protection. Under 750 ILCS 5/501(a)(2)(i), a court may issue temporary restraining orders or preliminary injunctions that prohibit either party from transferring, concealing, or disposing of property except in the ordinary course of business or for necessities.

These temporary orders help ensure that the marital estate remains intact until the court can divide the property fairly. In some cases, a spouse may also request that the court require both parties to provide an accounting of assets and expenses to prevent misuse of marital funds during the proceedings.

Why Dissipation Matters in an Illinois Divorce

Dissipation can make a major difference in your divorce outcome. The concept exists to promote fairness: both spouses should leave the marriage with their rightful share of what was accumulated together.

If one spouse depletes the marital estate for personal reasons, the other is unfairly disadvantaged. By identifying and proving dissipation, the court can restore balance through an equitable property division.

On the other hand, false or exaggerated dissipation claims can waste time and increase conflict. That is why Illinois law requires detailed, timely notice and strong evidence before the court will consider such a claim.

The Role of Evidence and Expert Testimony

In complex divorces involving significant assets, forensic accountants or financial experts may assist in identifying dissipation. These professionals can trace funds, analyze spending patterns, and determine whether expenditures were marital or personal.

Under 750 ILCS 5/503(l), a court may also seek advice from financial experts or other professionals, allocate their costs between the parties, and require them to testify regarding the value or use of property. This can be essential in cases where the dissipation involves business accounts, investments, or multiple financial institutions.

How Courts Enforce Dissipation Findings

When a court determines that dissipation has occurred, it may account for the value of the dissipated property in the final judgment. The court may:

• Adjust the property division to offset the amount dissipated.

• Assign debts or assets differently to achieve just proportions.

• Enter a judgment for reimbursement or a lien against specific property if needed to restore fairness.

The goal is always equitable relief—restoring what the other spouse lost due to the improper conduct. Dissipation findings do not carry criminal penalties, but they can have significant financial consequences in the division of marital assets.

Working With an Experienced Family Law Attorney

Dissipation cases are complex because they involve not only legal arguments but also detailed financial evidence and procedural compliance. If you suspect your spouse has hidden or wasted marital assets, or if you have been accused of dissipation, you should consult an attorney familiar with Illinois divorce law.

An experienced family law attorney can help you:

• Identify questionable transactions.

• File or respond to a Notice of Intent to Claim Dissipation.

• Collect and analyze financial records.

• Work with experts to trace funds or assess the value of lost property.

• Protect your share of the marital estate.

Even a seemingly small act of financial misconduct can affect the fairness of the final divorce decree. Taking timely and informed action is key.

Chicago Divorce Lawyer

If you believe your spouse has wasted or hidden marital assets—or if you have been accused of dissipation—you should speak with an experienced family law attorney right away. The lawyers at Collin Law Offices, P.C. are experienced at representing clients in complex divorce and property division cases throughout Chicago and across Illinois.

They can evaluate your situation, explain your legal rights, and help protect your financial interests. To learn more about how Illinois law on dissipation applies to your case, contact Collin Law Offices, P.C. by calling (312) 263-1252 or contacting us online for a free consultation.