When a party to an Illinois divorce has an overseas bank account, that account must be disclosed and, if found to be marital property, equitably distributed by the court. If the overseas account is not disclosed, Illinois divorce courts possess limited powers to investigate bank accounts in other countries. In an Illinois divorce, locating and dividing overseas bank accounts requires a combination of legal strategy, discovery tools, and persistence. Courts may lack jurisdiction over the foreign bank…but not over the spouse who controls the accounts
Marital Assets are Divisible In Illinois No Matter Where They Are Located
If the foreign bank account can be properly shown to be a gift, inheritance or was completely acquired in advance of the marriage, the foreign bank account will be deemed non-marital property and awarded in its entirety to the party who holds that account.
Beyond these exceptions, an overseas bank account will be deemed marital and, thus, divisible under Illinois law.
An Illinois divorce court “shall divide the marital property without regard to marital misconduct in just proportions” 750 ILCS 5/503(d)
In Illinois, “’[M]arital property’ means all property, including debts and other obligations, acquired by either spouse subsequent to the marriage”750 ILCS 5/503(a).
Assets held in a foreign bank is no exception to the Illinois Marriage and Dissolution of Marriage’s broad scope which includes “all property”
Determining If Overseas Bank Accounts Exist In An Illinois Divorce
People who deposit money into foreign accounts are not getting a bank statement mailed to them here in the United States every month from the foreign bank. Determining whether a foreign bank account even exists depends on the disclosures of the party holding the foreign bank account.
Every county in Illinois requires that divorcing parties fill out a financial affidavit when the divorce is filed.
In Cook County, Illinois the rule is as follows:
“(a) Pre-Judgment Disclosure –In all pre-judgment proceedings in which a party is seeking division of the marital estate, to establish, modify or enforce an order for maintenance, child support, or educational expenses pursuant to Section 513 of the Illinois Marriage and Dissolution of Marriage Act, support for a non-minor child with a disability pursuant to Section 513.5 of the Illinois Marriage and Dissolution of Marriage Act, disposition of property in a civil union, retroactive child support in parentage matters, or attorney’s fees and costs against the other party, each party shall serve a completed affidavit of incomes, expenses, debts, and assets (“Financial Affidavit”) upon the other party on forms approved by the court. The service of the “Financial Affidavit” shall be as follows:
(i) The Petitioner shall serve the completed “Financial Affidavit” not later than thirty (30) days after service of the initial pleading and the Respondent shall serve the completed “Financial Affidavit” not later than thirty (30) days after the filing of the Responding party’s appearance; or
(ii) Not less than seven (7) business days prior to a hearing, whichever date first occurs” Cook County Court Rule 13.3.1
On page 8 of the Financial Affidavit parties are instructed to “List the things you own that are worth something. List any balances as of the date of this affidavit. If you need more room for a section, complete and attach the Additional Information form for that section… Cash and Cash Equivalents (list balance as of the date of this affidavit; do not list account numbers.) Checking, Savings, Money Market, and Other Bank or Credit Union Accounts”
Any overseas bank accounts should be listed as instructed. Furthermore, the overseas bank account statements should be attached to the financial affidavit.
“The financial affidavit shall be supported by documentary evidence including, but not limited to, income tax returns, pay stubs, and banking statements.” 750 ILCS 5/501
If suspected overseas bank accounts are not listed on the financial affidavit or are not listed in satisfactory detail, the other party may request any kind of documentation regarding overseas bank accounts that the party has control of or access to.
“Any party may by written request direct any other party to produce for inspection, copying, reproduction photographing, testing or sampling specified documents, including electronically stored information as defined under 201 (b)(4), objects or tangible things…or to disclose information calculated to lead to the discovery of the whereabouts of any of these items, whenever the nature, contents, or condition of such documents, objects, tangible things, or real estate is relevant to the subject matter of the action. The request shall specify a reasonable time” Ill. Sup. Ct. R. 214(a)
While the party who holds the foreign bank account must disclose their assets, it is actually the responsibility of the party who wants the asset accounted for and/or divided to present evidence that the asset exists.
“[I]t is the parties’ obligation to present the court with sufficient evidence of…the property [and its value]” In re Marriage of Smith, 114 Ill. App. 3d 47, 54 (Ill. App. Ct. 1983)
So, what happens if the party who holds an overseas bank account does not disclose that overseas bank account?
Discovering Overseas Bank Accounts In An Illinois Divorce
A party with an overseas bank account may not disclose their overseas bank account but they will, most certainly, disclose their tax returns. Under the Foreign Account Tax Compliance Act (FATCA), tax returns must include disclosure of foreign bank accounts in excess of $ 50,000.
“Any individual who, during any taxable year, holds any interest in a specified foreign financial asset shall attach to such person’s return of tax imposed by subtitle A for such taxable year the information described in subsection (c) with respect to each such asset if the aggregate value of all such assets exceeds $50,000 (or such higher dollar amount as the Secretary may prescribe).” 26 U.S.C. § 6038D(a)
In addition to this requirement that a U.S. citizen or resident must report their foreign bank accounts to the IRS is the requirement that a U.S. citizen or resident report their foreign bank accounts to the Treasury Department at a lower threshold of disclosure (foreign transactions greater than $ 10,000).
“The Secretary of the Treasury shall require a resident or citizen of the United States or a person in, and doing business in, the United States, to keep records, file reports, or keep records and file reports, when the person makes a transaction or maintains a relation for any person with a foreign financial agency.” 31 U.S.C. § 5314(a)
The FinCEN Form 114, Report of Foreign Bank and Financial Accounts (FBAR) will be attached to a party’s tax return if filed.
The FinCen 114 form to report foreign accounts states that “This form should be used to report a financial interest in, signature authority, or other authority over one or more financial accounts in foreign countries, as required by the Department of the Treasury Regulations 31 CFR 1010.350 . No report is required if the aggregate value of the accounts did not exceed $10,000.”
So, even if a spouse had 4 foreign accounts of $ 2,500 each, the aggregate foreign bank account amount would be $ 10,000 and require the filing of this form.
If a spouse is so bold as to not disclose their foreign accounts to the U.S. government. The foreign bank is very likely to tell the U.S. government about the overseas account.
“Information required to be reported on United States accounts
(1)In generalThe agreement described in subsection (b) shall require the foreign financial institution to report the following with respect to each United States account maintained by such institution:
(A) The name, address, and TIN of each account holder which is a specified United States person and, in the case of any account holder which is a United States owned foreign entity, the name, address, and TIN of each substantial United States owner of such entity.
(C) The account balance or value (determined at such time and in such manner as the Secretary may provide).
(D) Except to the extent provided by the Secretary, the gross receipts and gross withdrawals or payments from the account (determined for such period and in such manner as the Secretary may provide).” 26 U.S.C. § 1471(c)
Some countries like Canada, Japan and the European Union won’t even let a U.S. Citizen open a bank account unless the U.S. citizen fills out reporting forms to tender to the U.S. government.
Russia, some African nations and several very small nations will not or cannot cooperate with reporting bank accounts to the U.S. government.
Even if the U.S. government knows of the overseas bank account, there is not a mechanism for a spouse to inquire as to the foreign bank account’s disclosure because that information is deemed confidential.
“Returns and return information shall be confidential” 26 U.S.C. § 6103(a)
Again, the only source for a party’s tax return which would indicate foreign bank accounts is the party themselves. If the party hasn’t amended their tax returns to reflect the previously undeclared foreign bank account, it will be extremely difficult to prove the overseas bank accounts exist.
Getting A Spouse To Admit They Have An Overseas Bank Account In An Illinois Divorce
The best practice to determine if an overseas bank account exists in an Illinois divorce is by examining the spouse’s U.S. bank accounts for outbound wires.
Foreign bank deposits do not come from nowhere. If there is a wire from a spouse’s U.S. bank account to a foreign bank account, that should be sufficient evidence of the existence of a foreign bank account with at least the amount that was wired to it.
A spouse who has wired money to a foreign bank account should be deposed where they can swear under oath where the money went, where is the money now and what other accounts exist.
People who hold but don’t disclose foreign bank accounts usually like to make things even more confusing by having shell companies be the foreign bank account owner. So, all money transfers to any entity need to be investigated to reliably determine if a foreign bank account exists.
If the funds in a foreign bank account were from a foreign source (another account or a foreign business), there will be very little that an Illinois court can do to force that disclosure by the foreign bank. At that point, I would advise the investigating party to retain counsel in the foreign country to employ that jurisdiction’s discovery techniques.
Turning Over Funds From An Overseas Bank Account In An Illinois Divorce?
Once a foreign bank account is proven to exist, the foreign bank account does not need to be liquidated and distributed to effectuate justice. The awarded portion of the foreign bank account can simply be paid through a U.S. bank account or other asset that the Illinois divorce court has jurisdiction over.
If the only funds available are in foreign banks, we have a problem. Foreign banks in foreign countries without explicit treaties with the United States do not have to observe an Illinois divorce court’s court order to turn over assets.
While an Illinois divorce court does not have jurisdiction over the foreign bank, an Illinois divorce court does have jurisdiction over the person getting divorced.
Illinois divorce courts are empowered to throw a spouse in jail if they believe that divided marital assets in a foreign account have not been tendered to the other spouse. See MARRIAGE OF HARNACK v. FANADY, 2025 IL App (1st) 240835 – Ill: Appellate Court, 1st Dist., 2nd Div. 2025
“Vital to the administration of justice is the inherent power of courts to compel compliance with their orders.” Harnack v. Fanady, ¶ 46
Overseas bank accounts are as divisible in an Illinois divorce as any bank account. The problem is usually proving the account’s existence. Don’t accept “there’s no jurisdiction” as the final word. If the money left a trail, you can follow that trail. If your spouse refuses to cooperate, the court can and will turn up the pressure.
To schedule a free consultation with an experienced Illinois divorce lawyer, contact my Chicago, Illinois family law firm today.
