owns goods own business, tries to say he's broke!

Renee - posted on 09/29/2014 ( 4 moms have responded )

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My Ex Husband Owns His Own Business And Hides His Money By Doing A Lot Of Cash Jobs And Putting All His Assets And Expenses In To The Business. How Can I Get A Judge To Grant An Increase In My Child Support If My Ex Makes Himself Look Broke And Only The Business Has The Money? I work, but it's not enough. I'm not saving anything. When I have an emergency lime my car needs work, I am forced to borrow from my parents or finance. I go to school and babysitters don't come cheap and he refuses to take them while I'm in class. I need some serious lethal advice but I can't afford it! Anyone familiar with nevada laws?

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Guest - posted on 10/14/2014

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He may not be lying. If he does any work on those trips or speaks to clients during those dates, they can be written off as business expenses, which, in addition to the tax break, also reduces his actual net income. The cars could be written off as well, which again, reduce his net income. The jewelry probably isn't unless it pertains to his business, but it could be costume jewelry--there is no way you could tell from a facebook image.

I run my own business this way--anything I can legally write off as a business expense gets subtracted from my net income so that I can lower my tax bracket. So his business could be earning several times the amount he is using to live on, but once he subtracts his expenses, he's actually only earning $25k or whatever on paper. It is only illegal if he is deducting non-business related expenses. You could probably report him to the IRS and get him audited, but noting you wrote about would raise any red flags for them.

Another perfectly legal way to manipulate funds is to keep most of your money in a business reserve account. Meaning, the money is still in the business set aside for expenses, so it isn't counted at income. Most business owners put as much money as possible into those accounts and only pay themselves the minimum they need for their personal expenses, this way they keep their personal income within lower tax brackets. In some states the money in the reserve is not considered part of the company's profits either, so that helps with business taxes as well. If they do need extra cash, they can access that money for personal use by paying themselves a bonus, but there is a high tax for that, so most try to manage it in a way so they don't have to. Again, legal.

I'm not saying it's cool for him to do this to avoid paying his fair share of child support, but it is possible he's just managing his funds the way any business owner would. Taxes can be BRUTAL for small business owners.

Dove - posted on 09/29/2014

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You can't... Really, if he's hiding his money chances are if the support was increased he wouldn't pay it anyway. If you can't afford a lawyer the best thing you can do is to budget the best you can to make it w/out child support.

Does he lie on his taxes too? Or do those show the true state of the business income? If his taxes are accurate you can request those to show his income.

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Renee - posted on 10/13/2014

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He will have to fill out a firm in the Motion called a Financial Disclosure Form. And of course he will lie. I'm sure he lies in his taxes. My only proof is Facebook posts bragging about expensive dates and wearing expensive jewelry and he and his wife both have brand new expensive car/truck.

Nosipho - posted on 09/30/2014

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hi,
how is he supporting the child if there is an order by the court they can do formal enquiry i think where the judge will have to decide if he can or not afford. Both of you will go and present your cases in court

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