Sad but true: when couple divorce, one or both may try to hide assets in order to come out ahead when everything is divided and the final documents signed.
Here are a few ways to make sure you know what’s what—even if you haven’t been in charge of the family finances up until now:
Get Uncle Sam to help you
Look to your tax returns. While divorcing spouses will mess with each other, they’re less likely to try to pull one over on the IRS, which is not known for its leniency or sense of humor. Your joint tax returns can help to uncover many assets divorcing clients may not realize they own since interest, dividends, and capital gains all get reported across the joint tax return.
Get the mail, and check statements
Take note of any and all statements or mailings from investments. Solicitation mail, prospectuses, and other junk investment mail may be a tip to an account which hasn’t been disclosed.
In the recent very low interest rate environment, this has become a little more difficult. Banks don’t have to send out tax notices on income paid less than $10 during the calendar year.
Visit your safe deposit
Take inventory of contents of safes and safety deposit boxes. Are there titles to assets you weren’t aware of lurking there?
When a spouse collects valuables of any sort—from stamps to jewelry to cars to apartments—that collection can be a good place to “hide” assets. Who’s to notice another bracelet or Ferrari, when there are so many of them? A little sleuthing can result in significant shifts in the asset balance, so it’s worth your time and effort.
Trust, but verify
It’s upsetting to know that the person you once loved and trusted most of all may not be open and fair in divorce. But so it is. Make sure you protect yourself by digging a little deeper before you agree to division of assets. Once it’s done, it’s done.
We can help
It’s useful to have an ally who knows the hiding places and how to unearth all the assets before your divorce agreement is final. If you need help, give us a call—the earlier in the process the better!