If your spouse is making Cash and not declaring it to the IRS – how do you get your Alimony calculated? Divorce Law Attorney Marina Shepelsky of Brooklyn, NY tells us how to prove to the Court how much his or her income really is.

Michael Levitis  00:00

Good everybody, it’s Michael Levitis. Here from JurisQ.com with divorce attorney Marina Shepelsky. Marina, last time we had you on, we talked about having a business with your spouse, how you should have your own attorney review documents. And you can review this video on juri q.com. Now I want to ask you a follow up question. What if your spouse has a separate business from you? And that business is a cash business or it’s making some cash that is not being declared? How’s it going  to affect your future or current divorce in terms of alimony and child support, how to find out how much the business is making cash and how that would affec the divorce.

Marina Shepelsky  00:51

This comes up very frequently, Michael, this comes up all the time. In fact, a lot of times one or both spouses are either self employed or own a business. Not everyone declares every dollar that they make. Some people write off more than they should really. And when you’re still married. It’s all you know, okay, I guess I mean, there might be tax fraud. But other than that, it’s okay. But if things go south, and things are really sour between the parties, let’s say the wife wants a divorce. And it turns out that the husband makes 13,000 on paper on tax returns, a thriving dental office is making for example, I’m just giving you one example, a dentist with a thriving dental office on paper and just showing personal income of only 13,000 a year. Well, you know, they drive a BMW, they have a Poconos home, they have a luxury condo, somewhere over looking water, and so on and so forth. So what happens if one spouse is hiding their actual real income gets cashed in song? Well, in that case, we’re really go into a deep accounting, that’s what we do. And what happens is, the judge will tell both sides that if you cannot come up with a number, we will make up a number for you. And we’re going to have to stick with that number. Because if you if you don’t tell the court how much you make, they’re gonna just do their best, you know, appointing an appraiser referee, something foreign. But how do we figure out how much the person makes when we need a realistic number, it’s never going to be accurate, because realistically, a lot of people don’t really know how much they actually make. We look at expenses. We look at the travel, like, for example, you know, somebody like I all the things I mentioned, they have a luxury vehicle, they have a luxury condo, they travel and stay at the Regis or you know the plaza, or like,

Michael Levitis  03:00

make an inference from their lifestyle.

Marina Shepelsky  03:03

When we look at the lifestyle, we’re looking at how much everything costs, we divided by, you know, 12, we figure out what the monthly income actually is. And sometimes people use business income for personal needs, but that’s still income. So even if you pay yourself a W-2  salary of only like 13,000 a year, you’re basically hiding business income, and the court will what’s called inferred to back to you like they will assume that’s where you’re making, if you don’t do it just a lot of times when people do is they realize that they don’t want to go down for tax fraud, because judges always threatened that if you don’t give me a number, I will report you both to the IRS for tax fraud. I had judged the Dominican Staten Island tell my client when she was arguing. Well, they’re you know, her husband lied on the facts that she said, Ma’am, you signed it. I can report both of you because you’re signed a joint married return and you’re now trying to give me evidence of tax fraud. So let’s play. You know, the judge said let’s let’s play this game. I will absolutely as the member of the bar as a judge reportable. So what do we do when we don’t want them report? Me and the other attorney, right, we sell but how do we set up again, the lawyers we can’t pull a number out of thin air and just make up. We look at the expenses. We look at tax returns and we look at bank statements. We look at bank statements, credit card statements, we look at how much they spend to figure out how much they make. We use that number to calculate child support enough. So that’s how we end up settling it it’s a very, like intricate, very tedious step by step job. But we usually get oh, by the way, we usually get an accountant involved because I didn’t go to law school to be you know an accountant. We get a forensic accountant, I have my own, the other side might get their own. We put this all together, an accountant gives us like a presentation, they say, Okay, we looked at the bank statements, we analyze this, where’s that we think we can infer that the husband makes 75,000 a year, already told her husband tell us a number that you think she will agree with. Sometimes people know, they just don’t want to tell you, but they know. So that’s how we work out that

Michael Levitis  05:29

in the same vein, then if somebody would say, has a degree, as an accountant, doctor, attorney, what have you, and they think they’re slick. And during the divorce to stop working, not to pay child support or alimony or what have you. It seems like the same principles will apply, where judge could infer based on their profession, based on their degrees, how much money they should be making is that right?

Marina Shepelsky  05:55

that’s true, too. But they don’t look necessarily at how much the person made during the divorce. They look, let’s say we filed for divorce June 1 2001. For example, the judge will want tax returns for 2019 18 and 17, not 2020. Because that’s the year we’re filing for divorce the other three years, and they look at bank statements for like three to five years. And they’ll look at credit card statements for three to five years, because people to prepare for divorce sometimes begin to, you know, embezzle assets of the marriage. Like they’ll hide it. Or they’ll start to pretend like they can’t work or whatever. It’s not just your right, they can infer when somebody was like a busy lawyer during the marriage and decided to stop working. They can infer that income, but how do we know how much the person is capable of making they look at the last three tax returns. And listen, people get sick. So somebody has a letter that they filed for disability, or were approved for disability, of course, the income that they had during the marriage will not be inferred. And you know, their circumstances things happen, right? We had, oh my god, I have the funny story. We had a guy come to see me a couple of weeks ago, I didn’t take them as a client, because he says he was from another state, given from the state of Connecticut. I’m not telling you the real name  or whatever. I’m just telling you the story, right? So he wasn’t really from Connecticut. But let’s assume he was from Connecticut from another state. He had a kid nasty divorce orders of protection like 9-10 years ago. And he was so nasty, my clients and that court that the judge threw him out, he had security take them out, and the judge never so bad. And he kept saying everything he says and why and things like that. And nobody ever likes. This is why you should have your lawyer, you didn’t have a lawyer. When you don’t have an attorney and you’re screaming out crazy things in court, nobody’s gonna listen to you. Even if something’s you’re saying,

Michael Levitis  07:58

right, or you have your own client, you are your own client, and you have a  fool for a client.

Marina Shepelsky  08:04

And he got an attorney, he was just, you know, a gentleman or whatever he did. So he got thrown out, you told me and then they ended up inferring a number, they made up a number of like 50,000 income for him. And they ordered him to pay child support. Now, he tried not to pay or an appeal and all this crazy stuff. But since he was present on the court, he couldn’t claim that they ordered him without his participation. They just threw him out because he was acting out of control. Anyway, long story short, it’s nine or 10 years later, now he’s got huge child support what’s called over the years like that, and built up to something like 70,000. And now he’s remarried. And his new wife seems like a reasonable lady. She works and everything. She’s trying to ask me how first of all, they can undo the old child support. I said you can’t because he had 10 years to undo this and make a motion this and then he never did anything. And also he was present in the case, even if it seems unfair to you, but also to lower your your income tax. I’m sorry, your child support now. They want to lower right now. And he says to me, are you ready? He says I’m illegal. So I cannot work. My income is zero. I said when you say things like that. This is when you get thrown out of the courtroom court. I said, Look, I’m telling you the argument that you are a deadbeat father, because you’re illegal and you cannot work. Guys, you know, I do immigration law too. Right. I talked to immigrants who are getting divorced every day. So people find jobs. If you’re an Uber driver, that’s income. If you clean you know, clean houses, if you wash dishes, if you’re in construction, you’re making money you’re somehow eating and supporting yourself you didn’t lose Like he was starving or homeless, he was well groomed. He came with his wife. I said, if the situation like this, the judge is going to continue to use the number that the kinetic can’t judge already picked out of scenario.

Michael Levitis  10:14

example where you have to have your attorney when you go to court, you have to discuss strategy before and have your attorney speak for your corn. So opening your own mouth,

Marina Shepelsky  10:25

right and I am stupid, stupid arguments. I’m illegal. So I cannot work. That’s why I’m not able to pay child support. Now my income is zero. It’s just not going to work. Make up a number I told

Michael Levitis  10:38

you always getting useful advice in very interesting ways. From your practice, from your experience, we appreciate it. And we’re gonna catch you next time with more questions. For now, please follow us on jurisq.com If you’re watching this on YouTube, or on Facebook or Instagram, please follow us please like us, and you’re gonna continue getting very useful advice in divorce and other areas of law.  Marina, thank you very much.

Marina Shepelsky  11:07

Thank you. And if you are interested in your lawyer telling you the truth and the reality, come to us, give us a call.

Michael Levitis  11:14

exactly the number is in the bottom of the screen. Thank you.

Marina Shepelsky  11:17

Bye