Divorces frequently begin for many reasons, but money and property will become the central focus of settlement negotiations by the end of the process. People in New Jersey might go to extreme lengths to hide money when their marriages end. Their activities to shift money away from spouses might begin years before the actual divorce filings. The desire to reduce alimony payments, child support or other distributions to an ex-spouse motivate these attempts to make income and assets appear low on paper.
In one case, an accountant skipped filing tax returns for two years prior to a divorce. During that time he sent in excessive amounts for his estimated income taxes. He typically owed about $40,000 a year, but he had sent the Internal Revenue Service over $500,000. He planned to file back taxes after the divorce and collect a huge refund as an individual, but his ex-wife’s accountant caught the trick.
People also place larger than usual deposits in their workplace retirement plans to make their take-home pay look lower. Access to a W-2 form will reveal the amounts of total compensation and what was put in a retirement plan. Another tactic uncovered during one divorce involved a woman getting cash back from grocery store purchases. Over time, she hid away $30,000 in cash.
A person seeking a divorce might benefit from scrutinizing financial records for signs of strange activity or a change in spending habits. An attorney might assist a person who encounters problems locating financial records. During the discovery phase of the divorce, an attorney may request documents from the other party. This effort might result in a complete disclosure of assets so that the person might achieve a fair division of property that includes a share of retirement accounts.