While one of the biggest bones of contention in a divorce can often be property division, when one partner in life has been concealing assets it can add a whole new level of strife to the situation. If loss of trust in a marriage is a common thread that leads a couple to decide to go their separate ways, it comes as no surprise when one or both spouses have such suspicions.
As Since Texas is a community property state, any property acquired by either spouse during marriage will most likely be divided evenly in the divorce. Property and assets from before, or received as a gift or inheritance during marriage, are not subject to division. However, in high-asset estates it can be difficult to tell what is separate and what has been commingled with marital property.
Where assets are often concealed
Experts point to several typical ways that people hide assets while they are married. The most common methods are:
- claiming an asset was lost
- denying it even exists
- transferring it to a third party
- creating false debt
These claims are challenging to prove, but it can help if there is still a paper trail. Unless your spouse has been very careful about covering up their actions, documents and annual returns usually point to the asset’s existence.
Concealed assets can show up in safety deposit boxes, lock boxes or other hiding spots in the home. Checking mortgage closing documents can also reveal listed assets, as these documents will include an accounting of all assets, liabilities and sources of income in the application.
Take inventory, and then start looking
After taking inventory of known property, looking at deductions, interests and dividends for discrepancies is a good way to begin. Concealed assets can be discovered in third-party affiliations that can be part of the profit or loss of a business, including capital gains and losses. Other hidden assets can show up where there are changes in reporting of royalties, partnerships, S corporations and rental properties.
Most importantly, while in the planning stages for your divorce, it is crucial to have the assistance of an experienced family law attorney serving the Houston and surrounding areas. Having legal counsel that is skilled in complex high-asset divorce proceedings will help you to discover the red flags that may be literally hiding under your nose.