You might be thinking this article is about hiding the money you earn from your partner and it’s true, but not in the manner you might think. If you’re happily married and have made the decision to conceal the money of your partner in order to save money or to protect the marital assets of your spouse is one thing. However, if you’re trying to conceal cash from your spouse to gain more assets during your divorce, you’re doing fraud and could put you in legal trouble.
This article is to bring out the different ways people try to conceal the money they have gotten from divorce, so that you’re aware of these methods and be aware of them in your divorce case.
1. Your spouse hides their earnings from You
If your spouse is employed by an organization that makes use of direct deposit (which is basically any business) or is self-employed, then it is fairly simple and normal way to go.
In essence, your spouse will take a small portion of their income to an account in a different bank that you don’t know about. It is commonplace when one spouse is given an increase in their pay in order to avoid raising any questions about the activities they’re engaging in. This is a common financial strategy to shift money into separate accounts with an individual purpose (such for emergency funds, deb repayments and taxes, etc.)
To find out the extent to which your spouse is involved it is necessary to examine their pay stubs. However, this isn’t a problem by itself, as many paytubs are issued electronically today and sent to employees via email. It may be necessary to start your divorce proceedings (and receive the necessary information on finances) to determine if your spouse is using this method.
2. Your Spouse Overpays the Taxman
The majority of couples submit jointly filed tax returns jointly. But that doesn’t mean that they need to. It could be beneficial to file separately in one of these situations applies:
- If the spouse and you are employed and earn a similar income, filing separate taxes can keep you in an income tax bracket that is lower;
- If you’re only eligible for tax deductions that are specific to you in the event that your adjusted gross is lower than a specific threshold and you file separately, it is a good idea.
- If your spouse is in tax debt or has past due child support payments you don’t want to be accountable for, you must make a separate filing.
It is not necessary to have the approval of your spouse to file separate. Simply inform them you’ve chosen to file separately and not submit a joint return. In the end, they’ll be forced to file separately , too. If you decide to file this way it is important to think ahead and get for your HR department for an increase in the amount of tax withheld. This can be done by filling out a new W-4 form. This form is usually completed when you are hired, but it is able to be changed at any time. If you do this you’ll be able to get more money deducted from your pay in order to be able to receive a greater refund after you file your taxes . the money can then be transferred to a separate account at a bank.
What do you do if you suspect that your spouse may be using this tactic?
It is likely that your spouse is employing this tactic if they) tell you they plan to submit separate tax returns, or) you begin to observe modifications to the amount which is deducted from their pay checks. An attorney can help with this as they’ll be analyzing your spouse’s earnings and searching for any changes in your income as time passes. If we notice the earnings of your spouse aren’t changing, however their net take-home is shrinking, or their income is growing and their earnings are staying the same, we may be able to ask questions regarding that.
Additionally, a lawyer may request the employment records of your spouse’s employer. These records will include W-4 forms your spouse submitted.
3. Your Spouse Gets Lots of Cash Back
One of the most simple and most popular ways to conceal cash is to allow your spouse to receive cash back each time they shop at the store crediting their debit card. It’s not easy, but the extra $20 or $10 each time you visit the supermarket can add up over the course of a few months. If your spouse doesn’t take the time to check the receipts, you’ll face no problem.
How can you tell whether you spouse uses this technique?
If your spouse has adopted this method, you’re likely to be the primary earner of income and are preventing access to money that your spouse has. There are more important things to be concerned about than the cash your spouse is hiding in order to hire an attorney (which is the reason why most couples do this). However, if you’re capable of locating a plethora of receipts showing the cash you received from your spouse, you could talk to you spouse to discuss it. However, the odds are it will be nearly impossible to track.
4. Your Spouse Rents a Safe Deposit Box
A safe deposit box for rent is a common practice. They are readily available at all major banks and are a great way to store cash, debit cards that are prepaid as well as additional credit cards. In addition, no one should know what’s inside the container – not even bank employees are not required to be aware of the contents.
Numerous forums and websites will inform you that placing money in safe deposit boxes is not a good idea, and could even be illegal. But, this article from the FDIC Consumer News says only that “you’re better off stashing your cash in a bank deposit account, like a savings account or certificate of deposit, than in a home safe or a safe deposit box.” This is mostly due to “cash that’s not in a deposit account isn’t protected by FDIC insurance,” declares Luke W. Reynolds, Chief of the FDIC’s community Outreach Section and the safe deposit box isn’t an account for deposit.
Even though cash inside safe deposit boxes is almost impossible to trace however, there is an evidence that you own the box. You will need to pay to lease it (between $15 and $25 annually) It is also important be sure to keep the keys from your spouse, too.
When and Why Would You Hide Money From Your Spouse?
In addition to the various ways to conceal cash from your partner, you could be asking yourself how to go about it and in what situations is this a solution you should think about?
People choose to store away money for a variety of reasons. Even if you’re happily married, you might want peace of mind having an emergency fund in the situation where things start to get worse. Also, in some cases when you start to feel that divorce or separation could be in the near future, and you’d like to be financially prepared in the event of a divorce or separation.
How Much Money is Enough?
If we’re talking about how to save cash, we’re not discussing money to purchase one or two grocery items or even one night in a hotel. It’s about having enough cash to ensure that you are able to move out of the house if you need to or even employ an attorney. In most instances, this will be in the range of $5,000 to $10,000.
However, you must be aware that having the amount of money you have may be appropriate in certain circumstances (such for instance, when there is domestic violence or you are the spouse of the dependent with no income) it could cause more trouble than it’s useful in other situations (such in the event that you’d be enticed by the cash and have difficulty conserving it, or in cases where it’s impossible to hide the cash away from the spouse). No matter what your circumstance it is important to be aware of the best way to go with “stashing cash” before you proceed with your strategy.
Do You Need to Be More Actively Involved in Your Family Finances?
One way to safeguard yourself from your spouse stealing cash from you is to play an active role in the family’s finances. In many families the spouse who is the primary one is responsible for handling the finances. That means they manage the balance for the checking account, make payments to bills, and even invest any cash they have. If you’re not engaged in these activities Perhaps it’s the time to get involved.
In relation to banks, you have be aware of every bank account that has your name attached to them. This means that you need to have passwords and usernames online for any bank account or credit card or investment accounts. which your name is linked to. Also, you should talk to your spouse about retirement plans and also be aware of the amount your spouse earns and put away for retirement. Additionally to that, if your spouse is granted access to additional benefits or perks like incentives, stocks options, or stock grants, you must be aware of the benefits too.
If your spouse is unable to disclose this information with you, then the space saga goes, “Houston, we have a problem.” A marriage that is based on deceit and the obfuscation of information is likely to fail unless some thing changes.
As long as you’re informed about the overall financial situation of your household You will have an easier time knowing what you have available when it’s time to split your assets in a divorce.
If you decide to disregard the state of the financial situation of your family and then it comes time to split, you could be at a serious disadvantage. There have been many instances where one spouse is confident that the other has their finances in order and has been saving properly and has built up some wealth. Imagine their dismay when they learn that their family is using credit cards to fund their lifestyle and are close to having to file for bankruptcy?