The divorce process can get extremely tricky when there is a business involved. Are you going through a divorce and generate income through a business operated by your soon to be former spouse? If so, your attorney will likely suggest that you bring a forensic accountant in to help with your case.
What is a forensic accountant?
A forensic accountant is generally a certified accountant that helps evaluate the financials of the business. He or she will examine all of the financial records of the business, analyze tax situations and calculate the actual income generated by the business. Forensic accountants are typically brought in to help with divorce cases that involve high-value assets, when financials are contested or when there is a business involved.
How does the forensic accountant help?
The forensic accountant may be brought in by an attorney or could be court ordered when a case is contested. The accountant works as a neutral third-party if ordered by the court. If your spouse hires a forensic accountant on his or her own, it is likely in your best interest to hire one of your own to ensure you are getting what is fair.
In some cases, both parties agree to hire a forensic accountant to assist with the division of a business or with difficult tax situations.
Why is a forensic accountant needed?
Oftentimes, forensic accountants are independently brought in to find hidden money and assets that one spouse may have. The accountant knows how to uncover these hidden assets and bring them to light to prevent one spouse getting away with paying the other spouse less than they should.
Forensic accountants are also needed to help divide the known joint assets. He or she will help to divide retirement accounts, businesses, and property. They can provide insight as to what each spouse should expect for the next tax season. Divorce can complicate taxes, so professional advice is typically welcomed.
When should a forensic accountant be hired?
Typically, the accountant should be hired at the beginning stages of the divorce. This will help the situation go a little smoother. If the assets are identified at the beginning stages of the divorce and the expectations of both parties are brought to an appropriate level early on, the stress and anxiety of the divorce could be greatly decreased.
Talk with your family law attorney to learn if a forensic accountant should be brought in to help with your divorce. Your attorney will help you make the best possible decision for your personal situation.
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