How do you know your spouse is being honest? Divorces so often are the result of a breakdown of trust and can be driven by financial pressures. During your marriage, if you were the primary income earner, you may have blindly deposited money into a joint account and trusted your spouse implicitly to spend the money on the family. If you were not the primary income earner, and you were trusting what your spouse was telling you, you may have no idea what your financial picture looks like.
Trying to piece everything together, given these uncertainties and the raw emotion that goes along with a divorce can be paralyzing. But you have options. Even before you file for divorce, an experienced Divorce Attorney can help you informally request documents and let you know if your spouse is being forthcoming or not. If your spouse refuses to cooperate and you’re forced to file for divorce, you can utilize the courts to force your spouse to produce documents and you can subpoena documents from third party sources like banks, lenders, and other financial institutions.
More often than not, it is very difficult for someone with a W2 job to hide money. If someone is paid by direct deposit, there will be a paper trail. By subpoenaing your spouse’s banks and employer a WSM Divorce Attorney can quickly and efficiently know how much money is supposed to be coming in, where it is being deposited, and then where it is going. There likely won’t be a question of hidden money, maybe only wasted money. If your spouse wastes money on a non-marital purpose the courts could find that this is financial misconduct and award you an unequal share of the marital assets as compensation.
Where the possibility for hidden money may actually come into play is where one or both spouses have complex income. This could be because one spouse is self-employed or because the spouse is a highly compensated employee and receives compensation other than direct deposited cash.
If you are the primary income earner, and you are self-employed or receive executive compensation, you may not actually know how much you are making. The cash that goes into your bank account is different than your taxable income which is different than your income which the court needs to consider for purposes of calculating child support which is different than the income figure for spousal support. While this creates opportunities to abuse the system and hide income or assets, it also create opportunities to settle a case fairly but creatively. Instead of simply splitting assets in half and calculating support, a different allocation of assets and support may be more efficient in that it reduces the overall tax liability. Instead of paying spousal support based upon Restricted Stock Units, maybe you could give your spouse the marital residence free and clear.
If you were not the primary income earner and it appears that your self-employed or highly compensated spouse is going to try to hold onto every penny, then you will certainly need the help of an experienced Divorce Attorney. A rigorous discovery process including formal document requests from your spouse and your spouse’s business interests along with third party subpoenas to accountants, bookkeepers, and banks will be necessary. Depending on the level of detail and potentially subterfuge, forensic accountants may need to be hired to trace and track all of the income and cash flow.
