Compiling all of your financial documents and completing the paperwork required for financial disclosure in divorce can often be very time-consuming. However, this is a necessary step for all couples facing divorce. This paperwork plays a key role in ensuring equitable property division, as well as in child support and alimony determinations.
Why is financial disclosure in divorce so important?
Ensuring both parties, their legal teams, and that the court knows about all marital assets is necessary in order to ensure everyone involved has the information needed to divide these assets in a fair way. This is true whether you work toward a settlement agreement or if the court determines the division of property in your case.
Having accurate and up-to-date financial information for each party is especially important when the court must rule on requests for child support or alimony. The judge bases the decision on who has custody of the child, as well as on the income and assets of both parents and any disparity between them.
Lastly, this paperwork helps you get a clear look at your own current financial situation. Oftentimes, one or both partners suffer financially during the divorce process because of the change in income or increased spending due to maintaining separate homes. The process of disclosing all income and assets in divorce gives both parties an updated look at their individual financial health.
How does the disclosure process work?
In order to correctly file the required forms, you need to first figure out what property is marital property and what is separate property.
The difference between these two types of properties is fairly simple. The only way something can be separate property is if:
- You owned it before marriage and it remains in your name alone
- It was a gift given to one of you by a third party
- It was an inheritance
- A prenuptial agreement prevents its inclusion
Any other items or assets are joint property and included in the division of property. A lawyer from Hecht & Associates can advise you on how to best demonstrate which property you believe belongs to you individually.
Couples seeking a divorce in Maryland must complete specific forms that aim to disclose the necessary financial information. While the court only divides marital property, these forms require information about your individual assets and debts as well. This is why figuring out which property is separate and which is marital is so important.
Maryland requires most couples going through a divorce use a legal form known as a Long Form Financial Statement to submit detailed information about their income, assets, and liabilities. In completing this form, you also sign a sworn statement that you have provided accurate and complete information.
This statement also safeguards both of you against future legal action claiming inaccurate or incomplete disclosure.
Your attorney should walk you through the process of completing these forms, as well as collecting documentation to show all financial holdings, getting property valuations for your home and business, and locating experts to appraise art, jewelry, and other valuables.
What stops my spouse from lying or “forgetting” about certain assets?
Income and asset disclosure is a critical step in the divorce process, and it hinges on trusting the other party to be forthcoming and disclose all income and assets. Unfortunately, though, this trust is often more difficult than it should be because the trust between the parties has often already eroded to the point where one or both parties may attempt to hide some assets or cheat their former partner out of a fair division of property.
This is why both parties must sign a statement promising that they provided full and accurate information in their financial disclosure documents. Either the court or your partner’s attorney can request that you submit supporting documentation to your disclosure if there are any questions or concerns about the totals.
At the same time, it is easy to overlook some assets during this stressful and emotional time. Your attorney should walk you through completing the financial forms and ensure you do not miss any assets or property. Some of the items that you must list include:
- Bank account balances
- Business interests
- Pensions and other retirement plans
- Stocks and bonds
- Valuable collections
Ensuring you have all the information necessary to get a fair division of property is at the heart of how Hecht & Associates serves clients. If there is any question, we will investigate the totals submitted by your former partner and determine the truth behind the full value of your marital estate. We work with forensic accountants and other experts to investigate financial documents and other evidence to uncover hidden assets.
We remain persistent, fighting for our clients throughout the entire divorce process. Call us today to schedule an initial consultation or discuss your legal options: 301-587-2099.