Image: Canva
Iowa divorce, Ponzi scheme investment loss, equalisation payment, a Lee County husband who lost $700,000 in a vacation-rental company must pay his former wife $351,446 to balance their property division. The Court of Appeals of Iowa upheld that order on 4 November 2026, after a marriage lasting nearly seven years. He said the trial court overstated the appreciation of a rental property on Avenue H by $20,000. The court had measured the gain from the 2017 assessed value of $110,390 to the agreed 2024 value of $209,040, giving $98,650. Todd wanted a 2009 appraisal of $131,000 used as the starting point. The couple’s assets totalled roughly $3.3 million, against nearly $900,000 in liabilities. Before the payment, the trial court’s allocation gave Todd a net $2,365,414 (95.6 per cent) and Julie $108,634 (4.4 per cent). After it, Todd received $2,013,968 and Julie $460,080. He wanted the payment recalculated from only about $381,311 of remaining marital assets, after removing $2 million he called nonmarital. Ability to pay also counted; even at the lowered income, Todd earns over four times what Julie does, and he was given 180 days to find the money. Todd, nearly twenty years older than Julie, was 60 at trial and had less time to rebuild retirement savings, but the trial court accounted for that by splitting growth in his investment account 65 per cent to him and 35 per cent to her.
Because it included four acres later sold, he also claimed the marital home, valued at $723,370 under an agreement the couple filed the day before trial, was overstated by $40,000. Because that finding rested on a credibility judgment and supporting evidence, the appeals court deferred to it. The trial court had also awarded all of Todd’s premarital property to him and reduced the payment so that it concentrated on sharing the growth in that property’s value.
The appeals court said using assessed values consistently made sense. Todd said he had over-insured them and offered his own lower estimates. Without the payment, his former wife, Julie Schneider, would have been left with a tiny net share of the couple’s property. The judges rejected that. Premarital ownership can be weighed as a factor, but it does not shield an asset automatically. For property that grew in value during the marriage, courts give special weight to each spouse’s tangible contributions, whether the growth came from luck or effort, and how long the marriage lasted. Todd then challenged three valuations. He produced no document showing which land was sold or how much of the price related to the home’s land, so the agreed value stood. Finally, the trial court valued the couple’s collectable cars at their insured values. The trial judge found the insurance figures more credible, calling them hard numbers, and noted that Todd had a reason to undervalue the cars in a divorce. An equalisation payment is a transfer from the spouse who holds more property to the other, evening out the final division. Todd argued the order grossly failed to do equity. He did not propose a new figure. The judges found the outcome fair for several reasons. A short marriage makes a lopsided division more likely to be equitable. Julie’s contributions weighed heavily in the trial court’s findings. She helped with painting and cleaning, managed tenants and carried most of the household duties. She also decorated, furnished and landscaped the family home, and gave Todd emotional support. The panel accepted that some of the appreciation was fortuitous, such as investment account growth that did not come from either spouse’s transfers. His claim to leave poorer than he entered found little support, and any decline stemmed largely from the investment loss. The decree was affirmed. You use AI every day. Now get your AI Quotient. Take the AIQ test.
Todd Schneider appealed the divorce decree, disputing how the trial court calculated his income, valued his rental properties and classic cars, and treated assets he owned before the marriage. Todd argued that assets he bought before the marriage should be treated as nonmarital and kept out of the division. Iowa law directs courts to divide all property equitably, excluding only inheritances and gifts, and that includes property a spouse owned before the wedding.
Todd and Julie Schneider became engaged in January 2013 and married in July 2017, when he was 54 and she was 35, according to the Court of Appeals of Iowa. Todd had three children from his first marriage and adopted Julie’s daughter in 2018. Both had been married before. All the children are now adults, so custody was not in dispute. Todd entered the marriage with significant wealth, built mainly on owning, running and managing rental properties. Farming on rented land and a small parcel of his own added a smaller share of his income. Julie, a licensed massage therapist, had run her own practice in Illinois before opening another in a building Todd owned, and she also helped with his rental business.
Near the end of 2022, Todd suffered a heavy financial blow. He expected to recover none of the money and still carried an outstanding loan of nearly $180,000. Julie moved out in February 2023, and Todd petitioned for divorce a few months later. A one-day trial before a judge, without a jury, took place in May 2024. Image: Canva The trial court had put Todd’s yearly income at $153,500, relying mainly on an undated, handwritten note in which he projected retirement income of $183,500 before a $30,000 withdrawal from an individual retirement account was deducted. Todd argued his real income was $73,000, the average of the rental and farm income on his tax returns. The appeals judges agreed the note was not the best evidence, since he most likely wrote it in or before January 2022, more than two years before trial. Todd reported nearly $28,000 in dividend income on his 2023 return that seemed likely to continue. He also claimed about $28,000 in depreciation that year, an accounting entry rather than cash spent. His 2023 returns showed gambling winnings and losses of $192,672, and bank records showed repeated large cash withdrawals at casinos. The panel settled on $110,000. That lower figure did not change the spousal support order of $2,000 a month. They added that Julie’s income of roughly $24,000 left her unable to sustain her accustomed lifestyle, and that the support can end as soon as the property payment is made and runs for 24 months at most.
Todd made no argument for how the amount should be adjusted, and the judges said they would not construct his case for him. Over the previous couple of years, he had invested in a vacation-rental company that went under, and he came to see it as essentially a Ponzi scheme. The marriage deteriorated at the same time. Todd then appealed, and a three-judge panel considered the case without oral argument. They also refused to accept his lower figure. Tax returns are usually strong evidence, they explained, but a self-employed person’s taxable income does not always show the money actually available to spend. Several findings pushed the figure upwards. His business and personal money were intermingled, which suggested some expenses were overstated. His lifestyle pointed the same way. He spent three winter months in Florida and kept buying classic cars.
