Each litigant involved in a paternity or divorce action is required to complete and submit a form to the Court, and the opposing party, must provide “full disclosure” of your financial information. In Massachusetts it is known as a financial statement. In New Hampshire, it is called a financial affidavit.
In Massachusetts, there are two different financial statement forms, depending on your annual income. For income under $75,000.00, you are required to fill out a “short form” financial statement. This form is easy to understand but does contain a lot of information. Be accurate and be as complete as possible. For income over $75,000.00, you are required to fill out a long form financial statement. For high asset type divorces, the form can get complicated. Be sure to use the best information that you have concerning estimates of value and work to include all debt due relative to each asset. There are also several schedules in the event that you are self-employed or receive rental income. Massachusetts Forms can be found here.
In New Hampshire, there is only one form, called the financial affidavit, for all income levels. It seeks information from all areas of income as well as your expenses. If you are involved in a high asset divorce, there may be a lot of information to put into this form and you may need to add attachments and/or footnotes in order to be complete. New Hampshire form can be found here.
In either state, full disclosure is mandatory during your divorce and there are consequences to not abiding by these rules. If you fail to disclose income or assets, or you do not accurately reflect any of the information on your statement/affidavit, the other side can allege fraud, the orders or agreements can be revisited and/or the Court can impose sanctions. That said, remember that providing full disclosure does not necessarily mean that your assets are going to be split with your spouse or that you will not fare as well in the distribution. Many times people believe that by providing all of the information, accurately, that they will “lose everything”. Keep the following in mind:
- Disclose everything. By not completing the forms accurately, it appears as if you are being dishonest. This will only fuel any fire that is sparking from the other side and cause potential negotiations to IF you think an asset is not divisible or that a particular form of income shouldn’t be shared, disclose it first then discuss it with your attorney (or argue to the court if pro se). Remember that if an untruth is exposed, everything in the case will then be second guessed, and rightfully so!
- Take the time that you need to fill out the forms. Failing to complete on the forms properly can be just as damaging as being purposely dishonest. This can create problems just as if you were being purposely untruthful. If you leave off small things such as overtime or bonuses, these are likely to get discovered. Leaving out assets such as pension plans, 401Ks or benefit plans will only send a red flag. It’s likely your spouse knows about these and may be watching for them with his/her lawyer.
- Add what information you have. If you don’t know specifics on an asset, list as much as you do know. Often in high asset divorces, I find that one spouse may know about a particular asset but very little detail is known about the account, balance, value, etc. because it is held or managed by the other. If you only know that there is a 401K at a particular bank, list just that. The rest will be found out later.
- Add footnotes if explanation is required. If income is different for a particular reason, footnote and explain that. If income will end on a particular date, footnote and disclose it. More information is better.
- You are signing the document and attesting that it is true and accurate. You don’t want to be in a position where it is later learned that you did so yet were misrepresenting the facts (or didn’t take enough care to ensure that the facts were true as listed on the form).
Take the time and make an effort to be complete when filling out these forms. Tell your attorney about all income and assets. Under no circumstances should you keep an asset hidden from your attorney. High asset divorces can be complex but with someone experienced representing you, things will move along.
If you are seeking representation or legal advice for your financial issues during your divorce, contact me. We can work together so that you understand exactly what must be disclosed and the process is not as daunting once you sit down to prepare the financial statement/affidavit.