Frequently it is critical to determine the income issue first, as it is not uncommon to go to court within a few weeks of filing to determine child support and spousal maintenance in temporary orders. Support is primarily based upon the need vs. ability to pay, and the parties income is a critical component to the ability to pay.
It is not uncommon for a self employed person to understate their income. This can be done in a number of ways, including:
- Payment of personal expenses from the business (such as auto expenses, phone and other utility bills, insurances, entertainment, food, etc.).
- Unreported income like cash payments.
- Money paid from the business to someone else (like parents, children, girlfriends, etc.) for services never rendered, that may eventually be given back.
Determining the income of a self employed person can be difficult, because they frequently have a lifetime pattern of hiding their income. There is a wealth of information contained within the financial documents that an experienced business mind can help organize and asses. If your spouse is self employed and has potentially hidden their income, you should consider discussing your case with an experienced family law attorney.
In my next post, I will talk about small business valuation.
The Renton law firm of Mogren, Glessner & Roti, represents clients in a variety of family law cases. Please visit our web page at Renton Divorce Lawyers for more information.