There are enough questions that accompany the divorce process. Where will I live? Will I receive spousal support payments? What will happen to our joint property? These are all common questions to have when going through a divorce. For some spouses, though, there is the extra burden of having to wonder if a spouse is attempting to hide assets.
It is a sad truth for many husbands and wives, but in an effort to get a bigger piece of the financial pie, there are spouses who will purposely lie and try to hide assets. Even though this is against Texas law, which requires the disclosure of all assets in divorce, there are still those who will try to hide assets, even by using some rather sneaky means to do so.
Watch out for these red flags
Here are some red flags to discuss with a divorce attorney right away:
- Inconsistencies with a lifestyle analysis: While a lifestyle analysis can help determine child custody and any need for spousal support, this tool can also uncover hidden assets. For example, if the living expenses and lifestyle choices do not match up with the known income and assets, this could be a sign that more money is actually coming in that what is reported. After all, you have to wonder, just how is this lifestyle being paid for? From what sources are the funds really coming?
- Buying collectibles or items that could be undervalued: A spouse may start buying expensive items, like antique rugs or additions to an existing collection – like a coin collection of art collection – either with the hope that the pieces will go unnoticed or undervalued.
- Overpaying certain accounts: Is your husband or wife overpaying or pre-paying creditors or the IRS? If so, you have to ask “why”? One tactic could be overpaying now, knowing that an overpayment will eventually result in a refund or a credit after the divorce.
- Stalling income: If your spouse typically receives their annual bonus every year around the same time, but is now allegedly not due to receive their bonus until later in the year, like after a divorce, if at all, this could also be a red flag. The attempt here could be to have less money listed as assets during the divorce, and thus less money to be divided by the Court between the parties.
Of course, these are just some of the tricks a spouse may attempt to use and is certainly not a definitive list.
At GUNNSTAKS LAW OFFICE, we handle the many aspects of divorce, including those involving high-assets and hidden assets. We work with tax specialists, business valuators and forensic accountants, when necessary, to uncover all assets in order to ensure that the final settlement is fair and that it follows the community property laws of Texas.