Divorce is rarely easy, but some cases are worse than others when it comes to financial problems if one spouse decides to hide assets. In property division, the assets and properties of both parties are evaluated and appraised to determine which assets are subject to division. Among the assets that can be divided is money in joint checking and savings accounts, payroll raises, commissions and business assets.
When resolving assets and property, obtaining a fair share is important and only possible if both spouses fully disclose all assets and debts. The trouble comes if one spouse has been financially unfaithful, which is surprisingly common. In fact, a poll from the National Endowment for Financial Education found that one in three people admitted to financial infidelity, that is, one spouse hid assets to keep them out of property division.
There are common methods for removing assets. A spouse can transfer funds to a separate account or to a friend, especially if he or she has control over a joint account. A spouse can make cash withdrawals on debit cards whenever they make a purchase and pocket the cash. Another way is when a spouse creates fake expenses and put that money aside for personal use. Lastly, a spouse can hold off billing clients until after a divorce, or a spouse could “forget” to declare that he or she has an employee stock ownership plan.
Any spouse entering divorce proceedings should understand that a husband or wife could hide assets if he or she wanted. Doing homework and reviewing all financial documents and records can help track those assets and ensure a fair share of all marital assets. More important, any spouse who engages in financial infidelity should know that hiding assets during divorce proceedings could result in later challenges and far less favorable legal outcomes.
Those struggling with property division and marital asset evaluation should seek assistance. This often means gaining independent guidance so they can understand their situation, make a financial plan and devise a strategy that is in their best interest.
Source: Daily Finance, “10 Easy Ways to Hide Assets From Your Spouse,” Robert Pagliarini, April 1, 2014