I have been practicing for a long time, and I have encountered certain situations many times. This is a way for me to address some questions that may be worrying you, and to explain that there are always ways to handle any situation that may exist or arise.
What Should I do if my spouse controls all of the family finances and just gives me an “allowance” to pay household expenses?
It is not unusual for one party, often spouse who stays at home, to be pretty much “in the dark” about the financial aspects of the marriage. Unfortunately, the same individual may be “in the dark” about other aspects of their spouse’s life. The good news is that in most cases it is not all that difficult to reconstruct this information. If your case is not settled prior to reaching an agreement, all financial documents can be subpoenaed, if your spouse does not willingly provide the statements. However, you will need to retain a divorce attorney to properly subpoena documents. Experienced family law attorneys routinely closely work with forensic accountants to obtain, analyze and present this information to the court, mediator and/or arbitrator.
If you do not routinely keep copies of your receipts for groceries, and do not know how much money you spend on food and other household expenses, it is possible to get a fairly accurate “guesstimate.”
First, print a calendar for the week and write down your “menus” for breakfast, lunch, dinner and snack foods for one week.
Second, make a list of all household cleaning products, paper goods and other supplies that you have in your home.
Third, take your menus and your list of food and non-food items to the stores you usually shop. Next to each item on your menu put in the price of the item. If you have a smartphone you can scan the bar codes. Then make your best “guesstimate” of how often you need to replace each item. It may be easier to break up the items into the stores that you purchase the item. For instance, if you visit a warehouse type store, like Costco and you generally purchase your paper products, cleaning products there; you can make an informed estimate how often those products need to be replaced. Your credit card statements will also give you important information to help jog your mind. If you are still at a loss for estimating, there is always “Google”.
If my name is on my mother’s (or any relative’s) property deed as a co-owner, but I do not have any financial obligations involving the property, do I need to include that property on my financial affidavit?
Footnotes are very important on a financial affidavit, and can be used to explain complex situations. Remember, you are swearing that everything written in your financial affidavit is true to the best of your knowledge on the date that you signed your affidavit. It is not unusual for family members to be co-owners with an elderly parent for estate planning purposes or for a sibling that may not have a high enough credit score to qualify for a loan, but is able to pay the monthly loan payment. An effective way of explaining your co-ownership is to explain your unique situation in a footnote, and offer to provide backup documentation, such as bank statements or copies of cancelled checks to show that you have not contributed to this asset.
If I lost my job in the previous twelve months and my income has changed dramatically, how do I compute my income?
This is another situation that can be effectively explained in a footnote. For example, if you were employed for the first half of the year, and then unemployed for the remainder of the year, state those facts in a footnote. Your attorney will be able to develop the best litigation strategy.
If I or my spouse is a “stay at home “ parent and has not worked since my children were born, how should I answer the income section?
Many couples make the decision that one party will leave the workforce to take care of children. When the divorce proceedings begin, the parties may have major disagreements as to whether there was an “understanding” that one parent should not be employed. Sometimes, each person has a completely different recollection of the facts. If you find yourself in this situation, it is essential to have an experienced attorney to present your unique situation in the light that is most favorable to your position. Likewise, if you are the employed spouse and your partner is making the argument that you agreed that he/she would not earn income, you will also need an attorney to present your arguments.
What if my spouse owns a small business and takes cash from the business for our household expenses, and does not report the entire income to the IRS, and the result looks as if we are living beyond our income?
It is not uncommon for small business owners to “help themselves” to cash and not report it to the taxing authorities. This can be a very serious situation for the spouse not involved in the business. Even though you were not taking the cash yourself, if those monies were used for your household expenses, you may be held responsible. You should advise your attorney as soon as possible, so that he/she can take whatever measures are necessary to protect you.
What if I have applied for a bank loan and “exaggerated” my self-employment income and I am concerned that I will be Ordered to pay a higher amount of alimony and/or child support?
Often individuals will overstate their income when they are anxious to appear to be a better candidate to the lender. You need to immediately bring this issue to your attorney’s attention so that he/she can do their best to explain your behavior to the court/mediator/ arbitrator. The sooner you inform your lawyer, the greater the chances that there may be a less onerous way to deal with these facts. The most foolhardy approach is to hope that your lawyer will not be confronted with this information at trial. In that situation, you can be punished severely by the Court.
What if I want to start a business and my spouse filed for divorce and my business will not support my lifestyle?
Unfortunately for many people, going through a divorce and having the parties establish their own households is a lot more expensive monetarily than supporting two households. In many families there is simply not enough money to go around. Although your future plan was to be an entrepreneur, unless you have another source of funds, in most cases your former spouse will not be ordered to give you funds to support your “dream.” The harsh reality is that most courts expect parties who are mentally and physically healthy to be employed. This is a situation which should be discussed thoroughly with your attorney who will be able to advise you how to proceed. If your divorce is litigated, in many states even if someone is unemployed (or under-employed) and has been for many years, the court can impute an income to you.
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