Proving a Self-Employed Spouse’s Income
It is increasingly common for people to work in the “gig economy” as an independent contractor or freelancer with numerous employers rather than in traditional salaried jobs. Similarly, individuals who own their own businesses are unlikely to have a consistent salary and are likely to have an income that fluctuates substantially. In the process of getting a divorce, both spouses will need to prove their income in order for the court or mediator to calculate spousal support, child support, attorneys’ fees, and an appropriate division of assets.
When workers no longer receive traditional documents such as W-2s that show their annual income in a central location and straightforward manner, there is a greater opportunity to conceal income sources in order to gain an advantage. If your spouse or co-parent is self-employed and you’re concerned that they may not accurately portray their income, read on to learn about ways you can prove to the court what they make.
Preparing in advance can help
If you are currently married but planning to get a divorce in the near future, begin to gather records as early as possible. While you still have access to things like bank records, credit card statements, records from a spouse’s business, or other evidence of income, make copies of these items now if you’re concerned that your spouse will not make complete disclosures to the court.
Even if you no longer have access to bank statements, invoices, or other records from your spouse’s business, take notes on what records you believe exist, so that your attorney will know what items to request specifically during the discovery process. Greater specificity can increase the chances that your spouse will be forced to produce the records you seek.
Present evidence of your spouse’s lifestyle
If your spouse reports an income to the family court that you know isn’t accurate, you may want to use evidence not of their actual income, but of the fact that their stated income cannot possibly be accurate. Make use of evidence of trips your spouse has taken, the car they drive, clothes they wear, or sporting events they’ve attended. Social media can help provide the proof you need.
Use the services of a forensic accountant
If you’re still having difficulty proving your spouse’s income, you may need to secure the help of a forensic accountant. These financial professionals are able to examine your spouse’s financial records to determine the actual income left over after business expenses or other losses. They can also provide an expert analysis of what a business might be worth.
If you’re facing a divorce or custodial dispute in Southern California, seek legal help you can trust, and contact the dedicated, compassionate, and knowledgeable Diamond Bar family law attorneys at Blasser Law for a consultation, at 909-843-6363.