February 28, 2014

How to Assure Cash-Based Business Income Is Included in Your Divorce

Cash Income on Financial Affidavit in Florida


Divorce is complicated. We know that. But in the end, when the case is finalized, things will work their way into a new normal and life can be better. The challenge comes in getting to that point. For the spouse who has supported the bread-winner, usually the wife, though caring for a household and children, there are ways to make sure that she gets her fair share.

In an article for Forbes.com, Jeff Landers suggests several avenues to explore to see if your spouse's business might be hiding assets during divorce, namely cash.

Much of the service industry in the United States is conducted by cash transactions, even in Palm Beach County. Lunch at the bistro, piano lessons for your daughter, a groom for Fido, are just a few of the occupations that see a great deal of cash for services. So, if your spouse has a business that might be in this arena, he or she may not always claim the cash as income. This will most likely affect how a judge awards spousal support.

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Cash is easier to hide than transactions with a paper trail such as using checks or credit cards. So how can you find out if your spouse is hiding revenue from cash transactions?

Landers says, "Cash is often used to buy luxury items that can add significantly to a person’s net worth, without ever having been reported to the IRS as income."

By understanding your spouse's business and how it is transacted, it may show an unexplained increase in net worth. But to discern the truth, hire a forensic accountant to complete a thorough Lifestyle Analysis. He or she may show that the standard of living is disproportionately high compared to the actual income shown on the books.

Besides understanding his business, simply paying attention to spending habits and other behaviors may help identify a problem. "During the marriage, there may have been a time when cash was paid for items in [your] presence. . . and the owner may have even bragged about this particular shortcut “saving” money on taxes," says Landers.

If this happened during your marriage, it seems likely that your spouse may try to continue during dissolution of marriage proceedings.

If you are concerned that he or she might be, consult a professional today.

 

Board Certified Marital and Family Law Attorney Charles D. Jamieson understands that divorce is an extremely sensitive and important issue. Thanks to extensive experience and a focus on open communication, Attorney Jamieson adeptly addresses the complex issues surrounding dissolution of marriage while delivering excellent personal service. To discuss divorce in Florida, please contact The Law Firm of Charles D. Jamieson, P.A.The Law Firm of Charles D. Jamieson, P.A. or call 561-478-0312. 

Image courtesy of posterize/ FreeDigitalPhotos.net

 

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