Helping You Resolve Difficult Issues In Family Law

Avoid moving money during an Arizona divorce

On Behalf of | Oct 14, 2016 | Uncategorized

For most Arizona spouses, going through the legal process of ending a marriage is a demanding time. There are many things that need to be accomplished, and seemingly never enough time to get everything done. Additional expenses also tend to arise during a divorce, and spouses should take care to handle all money matters in a way that places them beyond reproach. Divorce is a time of heightened emotions, and it is easy for spouses to become overly sensitive to any appearance of financial propriety.

Moving money or making large purchases during the timeframe leading up to a divorce is a recipe for disaster. Even when those expenses are perfectly legitimate, it is easy for one spouse to become convinced that the other is acting to intentionally deplete marital wealth. If the issue ends up going before a court, it can be very difficult to account for many different financial decisions.

Consider a scenario in which one spouse wants to extend a loan to a friend or family member or invest in their business. Even if the other spouse agrees to issue the loan, it can become a problem if a divorce takes place within a short timeframe following the transaction. That is because loans of this nature are commonly used to transfer money out of the marital equation. When used for this purpose, the spouse who initiated the loan usually makes an agreement with the recipient that the money is not actually a loan at all, but is simply to be “held” until after the divorce.

So, it is possible that a loan made for completely legitimate purposes could be painted in quite a different light. If a court can be convinced that the loan was a sham, then the spouse who initiated the transaction could be ordered to cede a portion of other assets to make up for the lost funds. That is why it is important for Arizona spouses to be extremely conservative when it comes to spending or moving money in the timeframe preceding a a divorce filing.

Source: U.S. News & World Report, “10 Ways to Prevent a Divorce From Ruining Your Finances”, Maryalene LaPonsie, Sept. 29, 2016