Dividing Assets Held for Children in a Washington Divorce

During a divorce, parents often focus on dividing property like homes, bank accounts, and retirement funds. But some assets, such as college savings accounts, custodial accounts, or a vehicle primarily used by a child, don’t fit neatly into the usual property division framework. These assets are typically held for the benefit of the children, not either parent, and require special care in how they’re managed after separation.

Common Types of Child-Related Assets

• 529 College Savings Plans: These education accounts are owned by one parent but are meant for the child’s future tuition and expenses.
  
  
• Custodial Accounts (UGMA/UTMA): Funds legally belong to the child but are managed by a parent as the custodian until the child reaches adulthood.
  
  
• Vehicles for Teenage Drivers: Often titled in a parent’s name, but primarily used by a child for school, work, or activities.
  
  
• Savings or Investment Accounts for Minors: Sometimes set up jointly by parents or funded by family members as gifts to the child.

How These Assets Are Handled in a Divorce

Unlike traditional marital property, most child-related assets are not divided between the parents. Instead, courts and attorneys focus on ensuring the asset continues to serve its intended purpose, benefiting the child. However, disputes can still arise over who controls or contributes to these accounts after divorce.

Key considerations include:

• Ownership and Control: Who will remain the custodian or account holder?
  
  
• Future Contributions: Will both parents continue contributing to a 529 plan or child’s savings?
  
  
• Usage Restrictions: How and when can funds be used for the child’s needs?
  
  
• Transparency: Will the other parent receive statements or access to monitor the account?

Addressing 529 Plans in Divorce

A 529 plan is legally owned by one parent, who can change the beneficiary or even withdraw funds. That’s why clear language in the divorce agreement is critical. Many settlements include terms requiring:

• Both parents to use the funds only for qualified education expenses.
  
  
• Notice and consent before making withdrawals or changes.
  
  
• Agreements on continued contributions and how future educational costs will be shared.

Vehicles and Other Tangible Assets
When a child drives a vehicle titled to a parent, that car is technically marital property. However, in practice, most parents agree to continue letting the child use it. Settlement agreements often specify who will:

• Retain legal ownership and insurance responsibility.
  
  
• Pay for maintenance, registration, and repairs.
  
  
• Replace the vehicle if it’s damaged or sold.

Collaborative Solutions Work Best

Courts prefer when parents work together to preserve these assets for the child’s benefit. A cooperative, well-drafted parenting or property settlement can prevent future conflict by clearly outlining how each account or asset will be managed.

How Magnuson Lowell, P.S. Can Help

At Magnuson Lowell, P.S., our family law attorneys help parents identify and protect assets meant for their children. We draft practical agreements that balance control, accountability, and flexibility—so you can focus on your child’s future without unnecessary disputes.

If you’re navigating a divorce and have questions about dividing or managing child-related assets, contact us today for a free telephone case evaluation 425-800-0573

When a divorce involves significant property, business ownership, or complex financial structures, accurate valuation is essential. Unfortunately, assets aren’t always straightforward. Income can be hidden, expenses can be inflated, and property can be undervalued. In these cases, a forensic accountant can be one of the most important experts on your team.

What Does a Forensic Accountant Do?

A forensic accountant is a financial professional trained to analyze and interpret complex financial data. In a Washington divorce, they help attorneys and clients:

• Identify hidden or transferred assets.
• Trace income sources and expenditures.
• Value businesses, investments, and retirement accounts.
• Review tax returns for inconsistencies.
• Analyze spending patterns and unusual transactions.

Their findings often serve as key evidence during negotiations or at trial.

When Should You Hire a Forensic Accountant?

Not every divorce requires one, but a forensic accountant is often helpful if:

• One or both spouses own a business.
• There are suspicions of hidden assets or unreported income.
• The couple has complicated investment accounts or properties.
• One spouse handled all finances during the marriage.
• There’s a large disparity between reported income and lifestyle.

Early involvement allows the expert to collect data before it disappears or becomes harder to trace.

How They Work with Your Attorney

Forensic accountants work closely with your family law attorney to:

1. Review disclosures and financial records.
2. Prepare expert reports detailing findings.
3. Provide sworn testimony in depositions or court if necessary.
4. Help calculate equitable divisions and potential support amounts.

Their objective analysis adds credibility to your financial claims and helps prevent costly mistakes or unfair settlements.

Costs vs. Benefits

While hiring a forensic accountant adds expense, the potential return often outweighs the cost, especially when significant assets are at stake. Identifying hidden accounts, correcting undervaluation, and proving income clarification can shift the financial outcome substantially.

Protecting Your Financial Interests

High-asset divorces require precision, experience, and a clear understanding of financial evidence. At Magnuson Lowell, P.S., we regularly collaborate with forensic accountants to ensure every dollar and asset is properly accounted for.

If you’re facing a complex divorce in Washington, contact us for a free telephone case evaluation 425-800-0573 to discuss whether a forensic accountant may help protect your financial future.

Divorce requires both parties to make full and honest financial disclosures. But not everyone plays by the rules. There are often concerns that a spouse may attempt to hide money, underreport income, or move assets to avoid dividing them during the divorce. In Washington, this is not only unethical, it can lead to serious legal consequences.

Common Ways Assets Are Hidden

Hidden assets can take many forms. Some of the most common examples include:

• Transferring money to family or friends.
  
  
• Creating fake business expenses.
  
  
• Undervaluing or concealing business interests.
  
  
• Withdrawing cash from joint accounts.
  
  
• Opening secret bank or cryptocurrency accounts.
  
  
• Overpaying taxes or debts to reclaim funds after the divorce.

How Hidden Assets Are Discovered

Washington family law allows extensive discovery tools to uncover hidden income and property, including:

• Interrogatories and Requests for Production: Formal written questions and document requests.
  
  
• Subpoenas: Obtaining records directly from banks, employers, or third parties.
  
  
• Depositions: Questioning a spouse or witness under oath.
  
  
• Forensic Accountants: Financial experts who trace money movements, review tax filings, and uncover irregularities.

The more organized your financial documentation is, the easier it is to spot inconsistencies. You can work with your attorney informally to review this information, and if you believe a more thorough investigation is required, hiring a forensic account to perform a full audit may be helpful.

Consequences of Hiding Assets

Courts do not look kindly on dishonesty. A spouse caught hiding assets can face:

• Loss of credibility before the judge.
  
  
• An unequal division of property as a penalty.
  
  
• Payment of the other party’s attorney’s fees.
  
  
• Potential sanctions or contempt findings.

In some cases, intentionally hiding assets may even rise to the level of fraud.

What to Do if You Suspect Hidden Assets

If you believe your spouse isn’t disclosing everything:

1. Stay calm and let your attorney handle communication.
   
   
2. Gather copies of financial statements, tax returns, and account records.
   
   
3. Avoid direct accusations without proof - let evidence lead the argument.
   
   
4. Discuss the possibility of hiring a financial expert early in the process.

Protecting Your Rights

Dividing property fairly requires a complete financial picture. At Magnuson Lowell, P.S., we help clients uncover hidden assets and ensure full transparency in divorce proceedings. Our team uses strategic discovery tools and expert resources to protect your financial future.

Call us today for a free telephone case evaluation 425-800-0573 to discuss your Washington divorce and learn how to ensure your settlement is truly fair.