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You should ask for documents and information relating to assets, income, debts and liabilities. Don't forget that assets come in different forms. Tangible assets include cash and other hard assets that can be sold or liquidated like the family residence, cars, jewelry, fine art, a wine collection, and other personal property. Intangible assets include assets such as savings accounts, checking accounts, brokerage accounts, retirement accounts, stocks and stock options, investment income, royalties, copyrights, and patents. So be sure to request a wide variety of records including receipts, loan documents, deeds, title records, account statements, stock certificates, subscription agreements, royalty agreements, tax documents, and W-2 forms.
If you're the “out-spouse,” you probably weren't preparing or reviewing tax returns during the marriage. It's essential you examine these during a divorce. Some important areas of a return are covered below. But don't stop here—tax laws and accounting issues are complex. It's important to consult a tax advisor if there are complicated tax issues in your divorce.
Before approving a loan, a lending institution will ask for a completed application, copies of recent pay stubs, account records, and a signed declaration regarding all assets and debts. If your spouse applied for a loan, get a copy of the application as it might reveal hidden income or assets.
In addition, your spouse may have submitted a personal financial statement to a lender. A personal financial statement should include all assets, debts, income, and expenses. It's basically a report from your spouse to the bank regarding all of his or her own finances and the marital estate. You should definitely ask your spouse (or the lender) for copies of all personal financial statements your spouse prepared.
Tracing (analyzing) accounts and cash flow during the marriage (tracing all money in and money out) may lead to the discovery of hidden assets. In order to perform a complete tracing, your attorney or accountant will need records for all accounts under one or both spouses' names (whether held alone, jointly, or with a third person). This includes savings, checking, brokerage, trust accounts, and any other accounts used by either spouse during the marriage.
Get copies of cancelled checks and ask for copies of wire transfer documents, including authorization forms and wire instructions, to see if your spouse authorized any major transactions you weren't aware of. Find out where the funds went. Did your spouse set up another personal account that holds a stash of cash? Did your spouse “gift” money to a relative or friend that your spouse will undoubtedly get back once the divorce is over? Did your spouse move money into a joint account with a third party? Tracing is a great way to uncover hidden assets.
You or your attorney can send a subpoena (a written request issued by the clerk of the court) to any bank where you suspect your spouse has an account. When subpoenaed properly, a bank is obligated to produce all records associated with your spouse's name. If the bank fails to do so, it can be held in contempt of court.
Review account records carefully. Search for transactions into and out of known accounts. Look for unfamiliar account numbers. For example, if you find a large transfer into or out of your spouse's account, check to see where the money came from or went. Banks typically list the name of the sending and receiving institutions and the last four digits of all accounts. If you find an unfamiliar account, you may have discovered a hidden asset. Follow up with a subpoena for records to that bank as well.
If you have questions about finding assets in your divorce case, you should contact an experienced family law attorney in your area for advice.
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