Determining Income in a Family Law Case Where a Spouse is Dishonest

One issue that family law practitioners often face is determining income in a family law case where a spouse is dishonest during the divorce by attempting to hide their true income or where they try to intentionally manipulate their income to appear lower during case.

There are several reasons why someone would want hide their income during a divorce, including: lower child support payments, lower spousal support payments, reduced financial responsibilities for children, and the list can go on. Most states have divorce and child custody statutes that address these types of issues and this article will attempt to discuss some of these in a manner which is not state specific.

In the case where a party to a family law case tries to hide income or is dishonest about the true amount of income they receive. There are many different types of employment where this can occur such as: business owners, barbers, or those who handle the books for their company to name only a few. Though each of these would have its own approach to counter, there are some basics that will usually tip off the court as to what is going on.

Every litigant to family law cases is usually required to file some sort of sworn statement of their income and assets often called a financial affidavit. Additionally, most states require parties to comply with certain mandatory financial disclosure which may consist of recent bank statements, past few years of W2’s and tax returns, credit card statements, and other similar basic financial information. If, upon a review of this information, it shows that the person earned significantly higher income prior to the litigation then there is an indication of some dishonesty or manipulation of income to warrant further investigation.

An attorney can file a request for production of documents, which would require the other side to gather and turn over more in-depth information

Should determining income in a family law case where a spouse is dishonest become an issue in your case, then your attorney can file a request for production of documents, which would require your spouse to gather and turn over more in-depth information, or for a broader time period, than the basic mandatory disclosure normally would. In addition to this, your lawyer may subpoena your spouses employment and income records from their business or place of employment. Once enough documents are gathered and analyzed, then you can have your spouse sit for a sworn deposition, where your lawyer can question them under oath, in order to try and pin them down about the income information.

After this the case will usually either settle or go on to a trial where your lawyer can ask the court to rule that the other party is hiding income, intentionally under employed, or has the ability to earn more than they do and ask the judge to impute that person at an income higher than that listed in their financial affidavit for the purposes of calculating support payments.

In most states family court judges are able to impute a higher income on an individual in cases where they have been dishonest about income, are intentionally under employed, or have an ability to ears substantially more than they currently do.

By Sean Smallwood, Esq.