Where to look if a spouse may be hiding assets during divorce
This article looks at what hidden assets are, why they matter, and how to find them.
One of the most important elements of most divorces is the division of marital property. In many cases, married couples will have built up a financial estate together, and each spouse is entitled to a share of that estate during their post-divorce lives. While dividing the marital estate may sound straightforward, it is often anything but. Many disputes during divorce tend to center around questions related to property division. One issue that tends to provoke a lot of anger and debate is hidden assets. Here’s a look at what hidden assets are, why they matter, and how to find them.
What are they?
Hidden assets are when one party to a divorce attempts to conceal assets from the other party. Hidden assets can take many forms, such as secret bank accounts, assets that are temporarily “loaned” to friends, or when one spouse lies about his or her income.
Why do they matter?
Hidden assets make it impossible to fairly divide marital property during a divorce. For marital property to be divided fairly and equitably, both parties need to know what is actually up for division. If one spouse is hiding assets that may rightfully belong to both spouses, then the other spouse is going to be at an extreme disadvantage and will often assume that the marital estate is smaller than it actually is. In turn, that spouse will likely get less than he or she deserves following the division of the marital estate.
How to find hidden assets
There are a lot of tricks for hiding assets, some more sophisticated than others. As Financial Advisor Magazine notes, hidden assets tend to crop up quite frequently when one of the spouses is a business owner. If business expenses have suddenly risen and profits have decreased inexplicably, it may be a sign that one spouse is using the business as a way to hide his or her income.
Furthermore, as Forbes points out, some spouses also choose to buy high-value items, such as artwork and collectibles, which may go unnoticed or underappreciated by the other spouse. In other cases, the spouse concealing the assets may have actual cash stored in a safe deposit box. Another trick is for somebody to deliberately overpay the IRS-which could lead to a refund after the divorce-or to delay collecting a bonus until after the divorce is finalized.
The fact is that uncovering hidden assets is usually extremely difficult. Anybody who has grounds to believe that their spouse or ex-spouse is hiding assets should get help from a family law attorney immediately. A family law attorney, working alongside a forensic accountant, can help those going through a divorce ensure that they are getting the settlement they deserve that will help them through their post-divorce lives.