November 11, 2020

The Financial Affidavit

A very important document in a divorce case is the financial affidavit that each spouse must submit to the court and the other spouse.  It is a statement of income, expenses, assets and debts that is certified “under the penalties of perjury” to be “complete, true, and accurate” on the date that it is signed. The judge uses the financial affidavit to decide whether to approve a negotiated divorce agreement or to decide upon financial orders if there is a trial.

There is an official Financial Affidavit form that is generally used.  It has a comprehensive list of sources of income, kinds of expenses, assets and debts.  But it doesn’t adequately deal with all situations.  And preparing it is not simply filling in the blanks.

Making it complete and accurate is often tedious, time consuming and challenging.  Since the sanctions for perjury apply, obviously, you must not lie.  Your lawyer will advise you to resist the temptation even to shade the truth thinking that will result in a better financial outcome.   If the judge perceives that the affidavit lacks credibility, that could have an effect on other aspects of your case where your credibility is an issue.  Moreover, the financial affidavit is the baseline to determine if later on there is a change in finances for the better or worse that justifies a change in a court order.  For example, if the truth about income were originally stretched on the low side to try to avoid paying alimony, a subsequent increase in income looks even more substantial.

While the financial affidavit must completely, truly and accurately reflect the person’s condition, financial information can often be presented in different ways. Your lawyer can help make the affidavit a useful advocacy tool.  For example, supplementing current expenses with projected post-divorce new housing expenses or showing average bonus income over several years might justify higher or lower alimony or college contributions.  Showing anticipated taxes and sales costs of real estate could strengthen a spouse’s argument for selling or keeping the property.  Footnotes or other explanations are typically permitted and the law doesn’t actually require using the court provided Financial Affidavit form.  

Making sure your financial affidavit meets the “complete, true and accurate” requirements of the law is well worth your time and effort. Working closely with your attorney and sometimes financial professionals should enable you to create an affidavit that meets legal requirements and at the same time presents the financial facts in the light most favorable to you.

This article first appeared in the November 5, 2020 edition of The Cheshire Citizen.

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