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Is an ex-spouse hiding money in a Texas divorce?

Thursday, June 29, 2017

When marriages come to an end, most people anticipate that it will be an emotional transition for them. However, many don't consider the impact a Texas divorce will have on their finances until later in the process. It is imperative for someone going through a divorce to protect his or her financial position, particularly if retirement age is approaching.

Unfortunately, some experts report that former spouses may hide or move assets during divorce proceedings. They also may misrepresent the value of retirement accounts to keep from sharing those assets. The realization that this has happened may not come about until much later after the divorce is final. There are so many factors to address while the divorce proceedings are underway that some details may not surface immediately.

However, since most financial transactions require a paper trail for the Internal Revenue Service, the much-maligned organization can be helpful in this situation. Retirement distributions must be reported on a 1099-R. Therefore, if proceed from a retirement account were withdrawn, there would be a record of it.

Experts also recommend looking for altered or fake documents. There are many ways to change numbers on a document, so it's best to examine it thoroughly before accepting it as presented. Also, there are online financial data tools that can provide historical data on investments to prevent someone from misstating their values.

During a divorce, it is important that the process is fair to everyone involved. Texas is a community property state, which generally means (with some exceptions) that assets accumulated during the course of the marriage are owned equally by the parties. While many are divorcing closer to retirement age, considering someone's hard-earned investments is critical. An experienced divorce attorney can work to ensure that finances are protected and the best possible outcome for a client can be achieved.

Source: Forbes, "Get Divorced In Or Near Retirement? How To Know If Your Ex-Spouse Hid Money From You", Robert Laura, May 31, 2017

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