In many marriages, one spouse is primarily responsible for the household finances. The other spouse may have a vague idea of the income and expenses of the family, but is often unaware of many of the details. An arrangement of this type may work just fine when both partners are fully vested in the best interests of the marriage. If, however, the relationship deteriorates and divorce becomes a possibility, the spouse controlling the finances may start trying to take advantage of the situation by hiding assets.
Virtually all divorce agreements involve division of property, to some extent, including marital financial assets. A spouse who is hiding assets is typically attempting to avoid losing all or part of them in the divorce and may plan to recover and use them after the divorce for his or her own gain. Hiding financial assets or property during a divorce is not only unethical, it is also illegal.
The best way to prevent your spouse from hiding assets is to make maintaining the household finances a joint responsibility from the beginning. Even if your spouse is inclined to hide anything, there is much less opportunity to do so when you are also involved in the financial decision making. However, if your spouse already has control of the family finances and divorce may be imminent, you should be aware of some of the most common signs that assets are being hidden.
Disappearing Financial Statements
Almost every household receives correspondence from banks, investment firms, credit cards and other creditors in the mail. If the usual financial statements are suddenly being delivered somewhere else, such as your spouse’s office or a post office box, there may be reason for concern.
It is possible for a decrease in your spouse’s salary to be completely appropriate if, for example, it is the result of poor performance, missed commission, or other market-based reasons. However, if the decrease is abrupt or the justification seems suspicious, your spouse may be deferring income, expecting to recover the money when the divorce is final. Similarly, if your spouse has turned down a promotion or a raise under seemingly unusual circumstances, delaying the extra pay may be the reason.
Overpaying Taxes or Deferring Refunds
Filing a tax return and intentionally overpaying taxes could be another way to hide assets, in this case, hiding them with the IRS. It could as simple as applying this year’s refund to next year’s tax liability, which is an option for almost anyone who is due a refund. If the divorce is finalized in the meantime, your spouse may have a large overpayment waiting at tax time.
What to Do About It
There are countless ways to hide assets, and any list is sure to leave off at least a few. Sometimes simply being able to read your spouse’s behavior and body language may be an indication all its own. If your spouse seems suddenly different or quickly gets defensive when discussing finances, there might be a problem you need to address. You do not, however, need to address it alone. Contact an experienced DuPage County family law attorney today. We can help you recover hidden assets and make sure your rights are protected through the entire divorce process.