Although it is unwise and can result in hurting your case if discovered, many divorcing spouses make it a point to try to hide assets, usually prior to a divorce action that they know is going to occur. Experience has shown that the more time they have before a divorce is filed, the more likely they are to attempt to hide assets from the other spouse.
Here are some tips on how to find hidden assets in a divorce:
Tax returns – one of the first things divorcing spouse must do is to fill out a net worth statement that lists all assets. If you suspect your spouse is hiding assets, you can get copies of your old returns from the IRS (if they are not readily available to you) from the last five years. You should look at the attached interest income schedules to compare the accounts listed there with those listed on the net worth statement. In addition, you need to compare real estate taxes and mortgage interest on the return with the real estate detailed in the net worth statement. You also need to check for an overpayment of taxes, which must eventually be refunded back to the payer – which may occur after the divorce is finalized.
Bank and brokerage accounts – obtain copies of bank, credit card and investment account statements for the past five years to check for any large transfers or withdrawals, and track where the money went. There may be an attempt to hide cash if you can track payments to a family member or friend of your ex. Also check to see if there are any statements in the names of your children or stepchildren that you did not know existed. And pay close attention to ATM withdrawals to be sure they are in line with what you expect.
Business – owning a business may make it easier for a divorcing spouse to hide assets. Investments can be written off as a business expense and expenses can be inflated to reduce income. In addition, you are entitled to request payment records from your spouse’s company, and should check these for any deferred bonuses or salary.
Also keep in mind that if you find hidden assets easily, they could be a decoy for a greater amount that has been hidden more carefully. Many divorce attorneys have learned from experience that to hide a lot of money well, you should hide a little badly.
We know that family law issues are often difficult, life-changing events. We also know how much it helps to have knowledgeable legal advocates on your side to help you obtain the best possible outcome. Contact us today for your free consultation.