When high-asset couples embark on the journey of divorce, the dispersion of wealth is typically a significant concern.
Waste dissipation, where assets mysteriously vanish, is a common issue that can leave one party feeling financially strained. Along with hiding assets, there are other ways to reduce the value of marital assets.
1. Excessive spending
One way assets dissipate is through extravagant spending, often done with the intention of depleting the marital estate. To demonstrate this, compile evidence of excessive spending habits, such as credit card statements, purchase receipts, and witness accounts. This can help establish that one party is deliberately depleting the marital assets.
2. Hiding income
In some cases, a spouse might attempt to diminish their apparent income by manipulating financial statements or inflating expenses. To reveal this, analyze tax returns, business records, and income statements meticulously. Discrepancies and irregularities may point to hidden income.
3. Transferring assets
Asset transfer is another method of waste dissipation. In such instances, a spouse transfers assets to family members or offshore accounts. To prove this, engage forensic accountants who can trace the movement of assets and reveal any irregularities in transactions.
4. Overvaluing debts
Some spouses might overstate their debts to lessen the overall marital estate. Carefully review loan documents and debt statements to confirm their legitimacy. Discrepancies between reported debts and actual obligations can indicate an attempt to dissipate assets.
Every month, Pennsylvania courts have approximately 3,000 divorce filings or dispositions. Considering that all of those take time for a final settlement, staying aware of shared finances may help minimize marital asset waste and provide evidence to ensure an equitable distribution.