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Financial Declarations in Family Court: Trap or Trump Card. You decide.

Financial Declarations in Family Court: Trap or Trump Card. You decide.

 

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Litigants and litigators regularly consider the financial declaration as a mere afterthought in preparation for temporary hearings or trial. The financial declaration is a required filing by parties in Family Court cases. Rule 20(b), SCFCR, requires the declaration be “filed and served prior to or at the first hearing, or no later than 45 days after the complaint is served, whichever occurs first.” The sworn document provides countless opportunities for opponents to capitalize on omission, misrepresentation, unsubstantiated, or mistaken figures. Missing debts and expenses allow opponents to avoid responsibility.

In a perfect world, the Financial Declaration should be prepared by your Certified Public Account (CPA) with direction, and the supervision of your attorney.

To prepare the financial declaration you will need the following:

1. Latest pay stubs from all employers, and statement of all income;

2. Last pay stub from last 3 years providing a specific annual amount of gross overtime earned;

3. Copies of

a. bills for property tax,
b. health insurance,
c. homeowners’ insurance,
d. latest credit card statements,
e. latest retirement statements,
f. latest investment account statements,
g. latest statements for checking and savings accounts,
h. balance on any mortgages,
i. itemization of personal property, and approximate value for property,
j. 12 month average of each utility, phone, fuel, maintenance, and other monthly expenses

4. Break down of number of parties covered under health insurance plan and dental plan with determination of cost associated

Page 1 of the document provides a complete picture of income and deductions, page 2 expenses, and page 3 and 4 assets. The information you gathered will provide the detail for each line item of the document. Remember math classes in high school? Show your work. Be prepared with notes and documents to support each figure listed on the financial declaration — at temporary hearing and trial.

Trap or Trump Card? You decide.

Beware of the Traps:

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Trap #1. Failure to report all of your income. You may have gotten away with lying to the IRS. Don’t push your luck in Family Court.
Trap #2. Failure to accurately report your overtime income (Remember, average the last three years)
Trap #3. Inflating expenses
Trap #4. Failure to list all credit accounts.
Trap #5. Mis-Identifying an asset as non-marital or marital.

Pull the Trump Card:

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Ace # 1. Maintain documentation for each figure on the Financial Declaration
Ace # 2. Utilize the assistance of a CPA and your attorney
Ace # 3. Review and update at least every 60 days, or if figures change
Ace # 4. Do not fear the truth of your finances — the good, the bad or the ugly
Wild Card # 5. Research asset values, or hire appraisers & Identify, itemize, and value personal property — use schedules and exhibits

“WHOEVER IS CARELESS WITH THE TRUTH IN SMALL MATTERS CANNOT BE TRUSTED WITH IMPORTANT MATTERS” — ALBERT EINSTEIN