Finding Hidden Assets During Divorce
In divorce cases, the marital assets must be allocated between the spouses. However, the assets must first be identified before they can be distributed. Therefore, it is vitally important that you and your attorney act diligently and thoroughly in this area. Financial expert, Ginita Wall, CPA, CFP, wrote an excellent article, Where to Search for Hidden Assets During Divorce, in which she suggests checking the following places:
- Antiques, artwork or hobby equipment that is overlooked and undervalued. Look for lush furnishings in his office.
- Collusion with his employer to delay payment of bonuses, stock options or raises until after the divorce.
- Income, often cash, that is unreported on tax returns and financial statements. You life-style costs during marriage probably exceeded reported income, so document your cash expenditures.
- A custodial account set up in the name of a child, using the child's social security number.
- Debt repayment of a phony debt to a friend or family member, with the pre-arrangement that the friend will hold the money until after the divorce, then give it to your husband.
- Salary paid to a nonexistent employee from your husband's business. The checks will be voided after divorce.
- Money paid from the business to someone close, such as father or girlfriend, for business services not rendered. The money will no doubt be given back to your spouse after the divorce is final.
- Delay in signing long-term business contracts until after the divorce.
- Expenses paid for a girlfriend, such as gifts, travel, jewelry, rent or college tuition.
- Investment in municipal bonds or Series EE Savings Bonds for which no interest is reported on tax returns.
Although this article was written for the Women's Institute for Financial Education, it is not gender specific, and it can be equally and effectively applied by both husbands and wifes.
Thanks to Janet Langjahr of the Florida Divorce Law Blog for her post on this topic.
