What is a Financial Statement in Divorce?

How Does a Financial Statement Work in a Divorce?

In divorce, separation, and family court proceedings, you will often be required to provide financial information to the court. Information such as income, assets, liabilities and expenses are usually collected in a form called a financial statement. During a divorce, the court needs these details to make decisions on issues such as alimony or alimony.

The form asks you to calculate your monthly income and expenses. This includes details about different types of income, your employment, how often you get paid, what kind you buy, and how much you spend on gas and other utilities. You should also list your debt obligations and how much you spend per month, in addition to any expenses related to any dependent minors or previous child support payments.

Without full and fair financial disclosure, a financial affidavit can deny one spouse the right to an asset or income they did not know existed. Lack of accurate disclosure can be grounds for voiding divorce agreements, and courts want to make sure that such agreements and court orders remain in effect. For this reason, courts almost always require financial approval.

Sample Financial Declaration in Divorce

Let's say you and your spouse decide to divorce and you have a young child. Even if both spouses basically agree on it, the court will require you to both fill out the financial document and swear to its truth before a notary public. That document then becomes part of your court record.

The information you provide becomes a factor in how the court determines any child support that may be owed from one spouse to the other, and can also be used to determine alimony if you and your spouse cannot agree on the terms. It can also be used to determine how to divide legal fees between spouses.

Financial Savings May Vary by State

State courts determine the rules for divorce, so the financial affidavit form and the rules for filing it will vary depending on the state you live in. A form or template for a financial statement is usually provided by the state or jurisdiction where your divorce is being filed. place.

For example, depending on the jurisdiction, a financial statement may be called a financial statement, an annual income worksheet, a financial statement, or sometimes a net worth statement.

Income Levels and Financial Savings

Some states have different financial affidavit forms – long form and short form – depending on the income of the spouse submitting the form. Income thresholds that determine which form you must file also vary by state. For example, a Florida resident who earns more than $50,000 annually must submit a long financial affidavit, but if they earn less than $50,000, they must submit a short financial statement form. For Massachusetts, a similar threshold for filing the long financial approval form is $75,000.

Sharing information with your spouse

The financial affidavit must be filed within a certain time frame set by the courts in your state and shared with your ex as soon as possible. For example, in Massachusetts, you must share your financial affidavit within 45 days of filing for divorce. In Connecticut, spouses must file and share financial statements at least five days and no more than 30 days before the first court hearing.

When do you submit the Financial Confirmation?

Even if you and your spouse have a prenuptial agreement, the court has the final say on how your property is divided. Although they are necessary for child support cases, the court may require a financial affidavit even if you do not have children.

However, in some cases, courts may allow both spouses to waive the requirement to file financial statements. This can happen when there is a divorce or when the spouses apply for a summary dissolution of the marriage. A simplified dissolution of marriage is a process in which both spouses agree on the terms of the divorce and there are no minor children. A simple solution usually requires fewer forms and paperwork.

In these cases, if both parties agree to a financial settlement and the court is not required to order any permanent financial assistance, such as child support, alimony, or property division, the court can proceed.

How Do You File a Financial Statement?

Once you've determined that financial approval is needed, it can usually be found on the court's website or from the clerk in that county.

Calculating Your Income and Expenses

You need to calculate your monthly income and expenses in order to submit financial confirmation. If you are paid hourly or have expenses that are not included in the monthly schedule, you should convert this to an average monthly amount.

For example, if you bill by the hour, this calculation would look like this:

Hourly wage x hours worked per week = Weekly wage

Weekly Salary x 52 weeks = Annual Salary

Annual Salary / 12 months = Average monthly salary

Similarly, if you buy bi-weekly, your average monthly income would look like this:

Average monthly income = (Fortnightly amount x 26 weeks) / 12 months

Documents required for issuing a Financial Deposit

To fill out the form, you need to add the income and expenses you mentioned in the financial confirmation. Required documents include:

• Latest pay slips and
• Income tax returns
• Bank and credit card statements
• Documents relating to any other assets or liabilities you may have

If the court relies on your financial evidence to make any decision, they will consider your income and any deductions, your debts and liabilities, your assets (including personal property and ), your children's assets and your health. insurance information.

Frequently Asked Questions (FAQ)