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6 ways your spouse may be hiding assets in divorce

If your spouse hides or undervalues assets, it may drastically affect your settlement. Know how to protect yourself. 

It is difficult to accept that someone you once loved may be dishonest in order to get a better divorce settlement. Unfortunately, it happens more often than many people realize. As divorce attorneys, we have represented countless people whose spouses tried to stack the deck in property division by hiding or undervaluing certain property.

But how do asset hiders do it, and how can you stop it? Below are six common practices that spouses use to hide or undervalue assets. If you suspect your spouse is doing any of the following, it is vital that you take steps to protect your interests.

  1. Hiding money (literally) -- It may seem obvious, but your ex may be hiding assets in cash - in a safe in your home, a deposit box at the bank or other hidden location. Keep an eye out for significant cash withdrawals, or any other signs this may be happening
  2. Fabricating debt - Your spouse may claim that he or she is making payments on debt when the money is actually being held to exempt it from property division. Spouses using this tactic often collaborate with family or friends, making payments that they will get back once the divorce goes through.
  3. Underreporting - or overreporting - on tax returns - Asset division is heavily based on tax returns. If your spouse underreports income, the unreported share typically will not be considered in divorce. On the flipside, he or she may also overpay the IRS at tax time, knowing that the excess can come back as a refund after the divorce is finalized.
  4. Creating custodial accounts - Your ex may use someone else's identity - such as a child's or new partner's - to open new accounts in that person's name. These accounts can hold assets, keeping them out of the pool during property division.
  5. Transferring stocks and other assets - Your spouse may transfer stocks, investment accounts or other assets into the name of a relative, business associate or friend. These assets may be transferred back into his or her name after the divorce.
  6. Hiding money in new purchases - Has your spouse recently bought any expensive, but easily overlooked items like furniture, antiques or collectibles? It could be a way to store money until the divorce goes through.

How can I make sure I get a fair share?

Hiding assets is not only unethical, but also illegal. If the person responsible gets caught, the court will often try to undo the damage so the victim gets a fair share. However, typically the victim must identify and prove the issue to the court first.

In a contentious divorce -particularly one with complex financial issues - it is important that you work with professionals who are experienced in uncovering hidden assets. A financial advisor or attorney can often analyze your family's income, lifestyle and documentation to determine whether you are being treated fairly. 

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Our office is conveniently located off Highway 50, just three miles from the Sacramento County Family Courthouse and minutes from Downtown Sacramento. For your convenience, we accept all major credit cards.

Victoria S. Linder Law Office
5303 Folsom Boulevard
Sacramento, CA 95819

Phone: 916-905-4805
Fax: 916-498-0127
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