If you have heard about or are in the process of completing a Financial Declaration for Family Court, you are probably feeling a mixture of dread and anxiety. This is normal. Take a deep breath and tackle it one step at a time. This article will explain why the Financial Declaration is necessary, provide tips on gathering documents before completing the Declaration, and offer some insights to help alleviate some of the unknowns.
When is the Financial Declaration Required?
The Financial Declaration is required whenever the financial condition of a party is relevant or an issue to be considered by the Family Court, as specified by Rule 20, SCRFC. These declarations must be filed with the Court and served on the other party prior to or at the first hearing, or no later than 45 days after the complaint is served, whichever occurs first (Rule 20, SCRFC).
Going through a Court Case is hard enough, why does the Court make us do this?
The financial condition becomes relevant when issues like child support, alimony, or the division of property are involved. The Financial Declaration provides essential information not only about income but also about the value of marital and alleged non-marital property. If the property is valued at more than $300,000.00, additional, more specific information is required. This helps both parties understand what documentation they need to establish a fair and equitable division of property in the case.
What if I just don’t Complete the Financial Declaration?
The Court can impose reasonable sanctions for failing to complete the Financial Declaration or for doing so inaccurately. Not completing the Declaration, or not doing so truthfully, can damage your reputation and credibility with the Court and the opposing party. Even if you two have an agreement, the Court still requires that the Financial Declaration be completed because the parties must have fully and accurately exchange financial information before signing a settlement agreement.
How do I Complete it?
- Read the Document Thoroughly: Begin by reading the entire document, including the instructions on how to complete the financial declaration.
- Gather Necessary Documents:
– W-2 forms
– Paystubs
– Mortgage or rent statements
– Bank account statements
– Credit card statements
– Health insurance premium costs
– Documentation for average monthly expenses such as streaming services, clothing purchases, food, and gas - Calculate Income:
– Use the W-2: Reference Box 5 instead of Box 1.
– Use Paystubs:
– For bi-weekly pay, multiply your gross pay by 26 and then divide by 12.
– For weekly pay, multiply your weekly gross pay by 52 weeks and then divide by 12.
– If your pay varies, averaging your income might be appropriate.
– For small business owners, include all self-employment perks and business profits. Personal expenses paid from a business account must be included in your gross income. - Calculate Expenses:
– Mortgage: If property taxes and homeowners’ insurance premiums are part of the mortgage payment, include them in the line for “Note or Mortgage Payment on Residence(s)” and add a footnote to the document about this inclusion. Do not include them again under “Real Property Tax on Residence(s)” and “Maintenance for Household.”
– Current Payments: Only include what you currently pay, not future responsibilities.
– Household Maintenance: Exclude large one-time expenses such as renovations or furniture purchases.
– Entertainment and Incidental Expenses: Do not inflate these expenses. - Helpful Footnotes for the Court:
– Footnotes can provide context and clarity for the Court, such as detailing the inclusion of property taxes and insurance in the mortgage payment.
By following these steps, you can navigate the Financial Declaration process more effectively and with less stress. Remember, accuracy and thoroughness are key to ensuring that your financial condition is presented clearly and fairly.