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Helton Law Firm, PLLC

Uncovering asset hiding during a divorce

Divorce involving a privately owned business can be particularly complicated due to the difficulties of establishing the valuation of the company. When people in Tennessee make the division to divorce, one of the most contentious parts of the end of the marriage is often the financial distribution of assets. However, the difficulty of property division can be elevated substantially when one partner attempts to hide assets from the other.

When one spouse has a greater level of involvement and control over the business, they may attempt to achieve a more favorable outcome in the divorce by obscuring the scope of their income and assets. This can mean falsely lowering their visible income and assets through the business or overstating the costs and expenses that it faces. In addition, they may attempt to bill their personal attorney's fees to the business rather than their own accounts and reduce the value of the business. By doing this, a divorcing spouse may hope to evade responsibility for spousal support, lower their child support payments or walk away with a larger share in property division.

In a case where one divorcing spouse is attempting to hide assets, their former partner may work with an attorney and financial experts to review the valuation of the business. By looking at financial records, they may uncover the false statements. They may also ask the court to assume reasonable compensation and income based on what would be a market rate salary for the business-owning spouse. The court could make other adjustments to compare the business to similarly situated corporations in the case of anomalous reports and valuations.

People going through a divorce might struggle with the end of their marriage and seek some sort of revenge through hiding assets. Divorcing spouses may work with a family law attorney to expose attempts to hide assets and to achieve a just property division.

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