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Inventory your assets prior to divorce—is everything there?

On Behalf of | Aug 19, 2019 | Firm News

If divorce is imminent, it is not unusual for either spouse to hide certain assets.

Perhaps your wife or husband has been largely responsible for the financial side of your marriage. If, in terms of marital assets, you sense he or she is not putting everything out on the table, it is time to launch an investigation.

Common hiding places

Your spouse could attempt to conceal assets in four ways:

  •         Transferring an asset to a trusted friend or relative for safekeeping until the divorce is final
  •         Claiming an asset went missing
  •         Saying the asset does not exist
  •         Creating false debt

Do not overlook possible hiding places in your home. You may find clues in a safe or safe deposit box. You could find something hiding in plain sight in your husband’s closet or his workshop. Find your mortgage closing documents. The information there includes your assets and liabilities, plus any sources of income you included when you applied for a mortgage.

Following the paper trail

A paper trail usually follows transactions, and one of the most complete roundup sources is the federal tax return. For example, Schedule B lists assets that provide dividends. Do you know about these? Schedule D spells out capital gains and losses, and Schedule E provides supplemental income and loss information concerning rental properties, partnerships, royalties or S corporations. Do you see any red flags here?

Starting the search

It is important that you receive equitable treatment during your divorce. If you suspect your soon-to-be-ex is hiding assets, make sure your attorney knows about your concerns. It may be necessary to issue subpoenas and hold depositions. However, your attorney may also recommend engaging the services of other professionals, such as a business appraiser or a forensic accountant. You may feel uneasy as you approach the property distribution phase of your divorce, but keep in mind that “missing” or supposedly nonexistent assets are almost always found.