You two built a life together over the years or decades, and you often put your own career growth on hold to help him succeed, run the house, or raise the kids while your husband built his business or moved up the corporate ladder.
You’re getting a divorce now, and you’ve learned that the comfortable life you shared doesn’t mean you have as much money as you thought you did. Your husband has access to smart accountants, financial advisors, and lawyers who help rich people keep their money safe during divorce.
You’re starting to understand that the community property that should be split evenly might include hidden accounts, businesses that aren’t worth as much as they should be, or complicated assets that you didn’t even know about. It seems that the income he says he needs for spousal support doesn’t match the way you’ve been living.
Schedule a confidential consultation now or call (714) 909-2561 to discuss your situation with the experienced family law attorneys at Moshtael Family Law. We’re experienced in high-net-worth divorces and understand how to uncover hidden assets, properly value complex property, and ensure you receive your fair share of the marital estate.
Understanding California’s Community Property Laws in High-Net-Worth Cases
California operates under community property law, which means that most assets and debts acquired during marriage belong to both spouses equally, no matter whose name is on the accounts or titles.
Family Code Section 2550 says that when a couple gets a divorce, the court must split their community property evenly. This simple idea gets more complicated when a lot of money is involved.
Community property includes money earned by either spouse during the marriage, businesses started or grown during the marriage (even if only one spouse ran them), real estate bought with community funds, investment accounts funded with marital earnings, retirement benefits earned during the marriage, and stock options or deferred compensation earned during the marriage, even if they haven’t yet vested.
In high-asset cases, it is very important to figure out the date of separation because it marks the end of community accumulation and the start of separate property accumulation.
Proving Separate Property Claims in California
Separate property stays with the spouse who owns it. This includes things like property owned before marriage, inheritances received by one spouse even during marriage, gifts given to one spouse instead of both, and money earned after the date of separation.
However, wealthy spouses often mix their separate and community property on purpose or through complicated transactions, which makes it very hard to trace without forensic analysis.
Your husband might say that the business he runs is separate property because he started it before you got married, or that some accounts only have his inheritance money in them.
To prove separate property claims in California, the law says you have to do exact tracing. When community and separate property are mixed together, the spouse who claims separate property character must prove the separate property part with detailed records. If your husband can’t give you enough information about the property, it might be considered community property.
When community funds are used to improve separate property or the other way around, reimbursement claims come up. If the community’s money paid the mortgage on the house you lived in together, the community may be able to get back the money plus interest.
On the other hand, he may be able to get his money back if he used his separate property funds to buy or improve community assets. You need to carefully look at these calculations and often get expert testimony.
At Moshtael Family Law, we’ve seen that spouses with a lot of money often try to make their assets look separate while making community property look smaller. Experienced family law attorneys who know how to divide up complicated property can find these structures and make sure that all assets are properly classified.
The Power Imbalance That Wealth Creates in Divorce
When there is a lot of money at stake, the spouse who earned or controlled that money usually has a lot of advantages in divorce proceedings that make things hard for the spouse who earns less or doesn’t earn anything. Understanding these power imbalances helps you see what you’re up against and why you need professional legal help instead of just wanting it.
Your husband probably has long-term relationships with accountants, financial advisors, business lawyers, and wealth managers who know everything about his money. These professionals might put protecting his assets first during the divorce, sometimes using strategies that break disclosure rules but are hard to spot without your own experts.
The spouse who controls the money can hire as many lawyers, forensic accountants, business valuation experts, and other professionals as they want without worrying about the cost.
This puts pressure on the other spouse, who has to carefully manage limited resources while making sure that these professional costs are in line with their own interests. California law offers remedies via attorney fee awards, as will be discussed later, but the financial pressure is immediate.
Having access to information gives you a lot of benefits. Your husband may have made financial choices without asking you, set up businesses you don’t understand, or kept accounts you didn’t know about.
Women who took care of the house and the kids while their husbands took care of the money often find out during divorce that they don’t know much about their marital assets. You need to know what questions to ask in order to fill this information gap.
Another common tactic is to scare people by making things complicated. If you ask your husband or his lawyer about business valuations, stock options, deferred compensation, or offshore accounts, they may give you a lot of technical information that is meant to confuse you instead of help you.
This kind of intimidation makes you less likely to do a proper investigation or accept settlements that are much lower than what you’re owed because the process seems too hard to understand.
If you’re feeling overwhelmed by the financial complexity of your divorce or concerned your husband is hiding assets, schedule a consultation on our secure online form to discuss investigation strategies with attorneys who regularly handle these cases and know how to level the playing field.
Your Right to Complete Financial Disclosure
In California, both spouses must fully disclose their assets during a divorce. If there are significant assets involved, the penalties are even harsher. Knowing your rights to full financial information and what happens when your husband doesn’t give it to you correctly will help you avoid being cheated during property division.
Family Code Section 2100 says that all assets and debts must be fully disclosed, and Family Code Section 2101 says that each spouse must give full and accurate information about all important facts that affect the value of assets.
This obligation persists during the divorce proceedings. Family Code Section 2102 says that you must tell the court about any big changes in your financial situation that happen between the first disclosures and the final judgment.
Forms FL-140 and FL-142, which are required for both the preliminary and final declarations of disclosure, require you to list all of your community and separate property assets, all of your debts and liabilities, your current income and expenses, and any supporting documents you have, such as bank statements, tax returns, retirement account statements, and business records.
Your husband must sign these statements under penalty of perjury, which means that lying on them is a crime that can lead to both criminal and civil penalties.
Knowing Your Discovery Rights As A Wife
In addition to the required disclosures, you have a lot of discovery rights that let you get more financial information through interrogatories that ask specific financial questions that must be answered in writing under oath, requests for documents like bank records, business documents, investment statements, tax returns, credit card statements, and communications about money matters, subpoenas to third parties like banks, brokerage firms, business partners, or accountants, and depositions where your husband or other witnesses answer questions under oath.
Family Code Section 2107 says that spouses can face harsh penalties if they don’t follow the rules for disclosure. Courts can fine you, give you attorney’s fees for looking into hidden assets, give you favorable presumptions about undisclosed asset values, give you 50% of undisclosed assets as a base penalty plus 100% of the asset if fraud or oppression is found (Family Code Section 1101), or set aside judgments that were based on incomplete disclosure.
Rich spouses often take a long time to discover things, give incomplete records, say that documents are lost or unavailable, give records in messy or overwhelming formats, or say they don’t want to share information because of privacy concerns. Your lawyer needs to be very aggressive in getting discovery and ask the court for help when your husband blocks a legitimate financial investigation.
Uncovering Hidden Assets and Income
High-net-worth individuals have a lot of ways to hide their money or make it look like they don’t have much income during a divorce. These tactics can be anything from technically legal but misleading financial deals to outright fraud. To find hidden assets, you need to know how people usually hide them and hire experts who can follow the money.
Businesses that deal in cash make it easy to hide money. Your husband might not report all of his business income, take cash before it is reported as revenue, pay personal bills through the business as deductible costs, or keep cash accounts that aren’t reported.
If you’ve been living a lifestyle that costs a lot more than your reported income can afford, this analysis of your lifestyle suggests that you have unreported income or hidden assets.
Call (714) 909-2561 to discuss your situation with the experienced family law attorneys at Moshtael Family Law.
How Your Rich Husband Might Try to Hide His Money
Wealthy people use offshore accounts and international business structures to hide their money. Offshore accounts are legal as long as they are properly reported, but they are often used in divorce to hide money from spouses.
Forensic accountants can find signs of offshore accounts in things like unexplained international wire transfers, business structures that involve foreign entities, tax returns that show foreign bank account reporting requirements, or communications about international financial matters.
Sometimes people play with deferred compensation, stock options, or other payment plans that are delayed. Your husband might be able to talk to his boss about delaying bonuses or exercising options until after the divorce, which would lower his current income.
If you earn unvested stock options or other deferred compensation while married, California law treats them as community property, even if they haven’t been paid out yet. However, you must show that they exist in order to get your share.
One common strategy is to undervalue businesses. Your husband might say that the business is worth a lot less than it really is by changing the financial records to make it look like it’s not making much money, saying that he needs his personal skills that won’t transfer, putting off big contracts or revenues until after the divorce, or hiring a business appraiser who uses aggressive discounting. You need to hire your own business valuation expert to fight these tactics.
People can give their assets to family members, business partners, or new romantic partners to “safekeep” them, and then agree to give them back after the divorce.
These illegal transfers break California law, but finding them requires looking at bank transfers, gift tax returns, loan documents, or other proof of transfers that happened around the time divorce was likely.
People are using cryptocurrency assets more and more to hide their wealth because they think they are private. But experts in blockchain analysis can follow cryptocurrency transactions, exchange records show transfers between regular bank accounts and cryptocurrency, and tax returns may show cryptocurrency holdings or gains that need to be reported.
Spousal Support When Your Husband Earns Substantial Income
California courts decide how much spousal support to give based on need and ability to pay, taking into account the factors listed in Family Code Section 4320.
When your husband makes a lot of money or has a lot of wealth, it can be hard to figure out spousal support because the formulas that work for moderate-income cases don’t work for high-income cases.
Family Code Section 4320 says that courts must look at the needs of the supported spouse based on:
- The standard of living in the marriage
- The supporting spouse’s ability to pay based on their income and assets
- The length of the marriage
- The supported spouse’s marketable skills and job prospects after being out of work
- The age and health of both spouses
- Any documented history of domestic violence
- The balance of hardships for each party, and
- The goal that the supported spouse become self-supporting within a reasonable amount of time.
The standard of living for the marriage is the lifestyle that both spouses had during the marriage. This is the starting point for figuring out what they need. If you lived in expensive homes, took luxury vacations, ate at fancy restaurants, sent your kids to private schools, and generally lived a wealthy lifestyle, your reasonable spousal support needs are based on keeping some connection to that lifestyle, not on expecting you to live very differently than when you were married.
High-earning spouses frequently assert their inability to afford considerable spousal support, despite earning or managing substantial income. These claims may be valid when substantial income is accompanied by commensurate business expenses or debt service; however, they frequently signify efforts to reduce support obligations. A lifestyle analysis that looks at reported income and actual spending patterns can show when claimed income doesn’t match up with reality.
Even if you haven’t worked during the marriage, your ability to earn money still affects support. If there is proof that you could make money with reasonable effort, courts may impute income based on your education, skills, and work history.
But if you gave up career advancement to help your husband succeed or raise kids, courts will look at how much time and money it would take for you to become self-sufficient. Your realistic earning potential is affected by how long you’ve been out of work, how old you are, and how out-of-date your skills are.
Courts have a lot of freedom when it comes to making spousal support orders. Family Code Section 4336 says that the court can change support for marriages that have lasted a long time (usually ten years or more) as long as there is no set end date. This ongoing jurisdiction is an important safety net in case your husband’s income or financial situation changes over time.
Smith-Ostler support orders say that your husband has to pay you more support if his income goes above a certain level. When income changes a lot from year to year, these orders work well because they make sure you get the most out of good years instead of support being based only on lower base income.
Attorney Fees and Expert Costs in Complex Divorces
The cost of properly valuing, investigating, and dividing complex marital estates creates significant barriers for the spouse who makes less money. California law gives people ways to even out the financial playing field by giving them attorney fees and dividing costs.
Family Code Section 2030 says that courts must make sure that both parties have access to legal representation by making the higher-earning spouse pay the lower-earning spouse’s attorney fees and costs when one party’s access to funds would affect the other party’s ability to litigate the case. This law says that both sides must be able to afford good lawyers in order for justice to be fair.
Family Code Section 2032 lets judges award attorney fees based on the needs of the parties, their ability to pay their own fees, and whether the fees are necessary to make sure the case is presented properly. When deciding a case, courts look at more than just the parties’ current income.
They also look at their assets, the complexity of the issues that need legal expertise, and whether one spouse has made it harder to reach a settlement by taking unreasonable positions or blocking discovery.
When a divorce involves business valuations, hidden asset investigations, complicated discovery, custody disputes, and trial, attorney fees can easily reach six figures. These costs are shocking, but they show how much work it takes to protect your interests. Fee awards make sure that your husband can’t just pay you more money to get you to agree to an unfair settlement.
Another big cost is the fees for expert witnesses. Business appraisers charge between $20,000 and $50,000 or more for full valuations. Forensic accountants who look into hidden assets charge between $15,000 and $100,000 or more, depending on how complicated the case is. Child custody evaluators charge between $10,000 and $25,000 for full evaluations.
Real estate appraisers charge several thousand dollars per property, and vocational evaluators who look into earning potential charge between $5,000 and $15,000. Courts can tell the parties to share the costs of experts or divide them up based on how much money each party has.
Your lawyer should ask for fee and cost orders early on in the case so you have the money you need to properly investigate and fight your claims. These requests must be backed up by Income and Expense Declarations (Form FL-150) that show how the two parties’ financial situations are different, as well as detailed billing statements that show the fees that were charged.
Protecting Your Financial Future During High-Asset Divorce
You need to plan for your long-term financial security, not just the divorce case. This means making sure your interests are protected during the divorce and making plans for your finances after it.
If you want to know the real value of settlement offers, you might want to hire a Certified Divorce Financial Analyst (CDFA). They can help you figure out whether to keep or sell certain assets, compare different property division scenarios, project post-divorce cash flow and tax obligations, and analyze settlement proposals and their long-term tax and financial effects. These experts have a different point of view than lawyers or regular financial advisors.
Tax consequences have a big effect on how property is divided. When you sell or give away some assets, you may have to pay a lot of taxes. For example, when you divide up your retirement accounts, you need a Qualified Domestic Relations Order (QDRO).
When you sell property that has gone up in value, you may have to pay capital gains taxes, which lower the value of the property after taxes. Alimony is also taxed differently than property division. If you know how these taxes work, you won’t agree to settlements that seem like they are worth a lot but have hidden tax costs.
The liquidity of your assets affects how easily you can get the value that was given to you. Your husband might want to give you illiquid assets like partial business interests or real estate while keeping liquid accounts for himself. You need enough liquid assets to pay your bills and avoid having to sell assets at bad times, even if illiquid assets have a lot of paper value.
Planning your budget after your divorce should start while you’re still married. Before you agree to the terms, you need to carefully think about your realistic expenses, how much money you can expect to make from work and support, how much healthcare will cost when you are no longer covered by your husband’s insurance, what your housing needs and costs are, and whether your settlement gives you enough resources to stay reasonably stable.
Proper documentation and transfer of awarded property protect it and make sure you get what the judgment says you should get. This includes moving retirement accounts through QDRO, moving real estate through properly recorded deeds, moving financial accounts with clear paper trails, and moving business interests with official paperwork.
After the judgment, your lawyer must carry out these ministerial duties to make sure you get the property you were awarded.
Moshtael Family Law Protects Your Rights in High-Net-Worth Divorces
You might feel overwhelmed by how complicated the finances are when you divorce your rich husband in California. You might be worried about whether you’ll find all of his assets or whether you can afford the lawyers and experts you need to protect your rights.
These worries are real—divorces with a lot of money need skilled lawyers and thorough investigations. But California’s community property laws and rules about disclosure offer strong protections when they are followed.
You have the legal right to half of all community property, no matter whose name is on the accounts or titles. You also have the right to full financial disclosure of all your assets and income, attorney fees that let you afford good representation, and penalties against your husband if he hides assets or breaks disclosure rules. You can only be safe with these rights if you have experienced representation and are very strict about following them.
The level of support you need is based on the standard of living you built together while you were married. You have the right to share in the wealth that you and your husband built up during your marriage because of the sacrifices you made for your career, your home, your children, or your husband’s professional success.
Schedule a confidential consultation now or call (714) 909-2561 to discuss your situation with the family law attorneys at Moshtael Family Law.
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