Hidden Assets and Divorce
If you’re in the process of getting divorced in Florida, it’s important to think about all the property—everything—that you and your spouse acquired during the marriage. In particular, with contentious divorces, or those likely to get heated when it comes to property division, spouses might be “justified in searching through the family tax returns to find hidden assets,” according to a recent article in Financial Advisor Magazine.
Searching for Hidden Assets: Where Should You Look?
Most financial advisors say that the first place to look for hidden assets when you’re facing divorce is in your tax returns. Whether you’re perusing personal or business tax returns, you should always “look back five years and check such things as capital gains and itemized deductions.” What are you looking for? For example, you might keep an eye out for some of the following:
- Real estate that you may not know your spouse purchased during the marriage;
- Art objects or other cultural artifacts purchased during the marriage; or
- Gambling losses or winnings.
When one spouse has an item of marital property that the other spouse doesn’t know exists (for example, some kind of real estate), that spouse may try to keep it a secret during the divorce proceedings so that the court doesn’t classify it as marital property and subject to division.
Let’s get a better idea of how this might work in a hypothetical scenario. Suppose your wife purchased a small vacation home with her earnings. She only listed it in her name, but she bought it during the marriage. Now, even if she says it’s her property, because she purchased it with her earnings, the court likely will look at this piece of real estate as marital property. Remember, money made by either spouse during the marriage typically will be classified as marital property rather than separate property. And if this vacation house remains a “hidden asset,” then the court won’t be able to consider it when property division occurs. As such, without bringing to light the existence of this property, your wife will end up with more assets than the judge thinks is equitable.
Equitable Distribution of Marital Property
Remember, under Florida law, the division of marital assets requires equitable division. In other words, the property won’t necessarily be split in half, but rather will be divided based upon what’s fair.
In addition to the tax return, you might also check your spouse’s business expense reports or any obvious spike in listed expenses. When expenses rise without a clear reason, the spouse may be trying to hide assets.
Contact a Florida Divorce Attorney
Do marriages really have hidden assets? In many cases, they do. And since a judge will look at all of your property when deciding how to divide it fairly, it’s important to be sure that the court has a complete picture of all marital assets. If you have questions about Florida divorce or property division, you should always discuss your case with an experienced Hollywood divorce attorney. Contact the Fort Lauderdale and Hollywood Law Offices of Steven A. Mason, P.A. for legal advice at 954-963-5900 or leave a message online.