How to Prepare Your Statement of Net Worth
In New York divorces, both parties must complete an affidavit where they describe their entire financial background. This affidavit is known as the Statement of Net Worth and it’s the most important document you will complete in your New York divorce.
In this document you will disclose your income, assets, expenses, and outstanding debts. This document is a sworn statement, so it is very important that it is complete and accurate. It’s best to start gathering the information you need as early as possible.
This document can be overwhelming to complete since many people have no clue what their debt and expenses are. The form itself is also long and can be quite confusing. Hopefully these tips can make completing it easier for you.
You can find the form here. Remember, all information should be accurate as of the date you sign.
The first section asks for basic information about you and your family including dates of birth, ages, social security numbers health and education.
This section asked for very detailed monthly household expenses. Look at your bills, bank and credit card statements to come up with accurate averages. It’s important to be as accurate as possible so try not to guess. It can be very helpful to provide your attorney with copies of the documents you base these numbers on.
When completing this section, remember you need to provide monthly amounts. Divide the yearly amount of an expense divide it by 12 and multiply weekly amounts by 4.3.
Include every expense, even if someone else pays it or it is currently not being paid. I’ll have my client include an asterisk with a note about expenses that need to be explained. If an expense does not apply to you, put N/A. Failing to include an expense will only hurt you.
Use a recent pay stub and W-2 for the most recent tax year to accurately complete this section. This is also where you will add any other form of income you receive.
If you have income that you didn’t report on your tax return, discuss how to proceed with your attorney.
This section is where you will list all of your assets including bank accounts, jewelry, real estate, businesses, and vehicles. Again, be as accurate as possible and include account numbers where applicable. If you don’t know the value of something, don’t guess, put TBD (to be determined).
Also include your spouse’s assets. List them as the title holder (or joint if you think that’s the case) and put TBD for all the information you don’t have yet.
This section includes all of your debts including credit cards, mortgages, or loans you must repay (even loans from family).
In this section you will say if you are receiving or asking for any support and the amount you are receiving or requesting. Complete this portion with your attorney so they can help you determine the appropriate amount to request.
You can also include if you are requesting counsel or appraisal fees. If you are unsure you can note that you are reserving the issue for the Preliminary Conference.
The section is where you sign and swear that the information you provided is accurate and true.
Be as accurate as possible
If your case goes to trial, your spouse’s attorney will cross-examine you using this document. Since it is a sworn statement, if you guess and you are way off, it would appear as if you are lying to the court. Take the time to look at statements and give accurate responses.
Remember You Are Under Oath
Deliberately providing false information, or omitting information, on a Statement of Net Worth is perjury, and therefore you can be held in contempt of court. Correct any mistakes as soon as possible, even after the form has been filed with the court.
It’s Up To You To Spot Errors
Your attorney does not know your spending habits, so it’s up to you to make sure what you disclose is accurate.
I review every Statement of Net Worth for obvious errors, but sometimes it can be difficult to tell. People spend drastically different amounts on food, clothing, or vacations, so I usually don’t question whatever my clients put down. If it seems disproportionate to their income I may inquire, otherwise I’ll assume it’s correct.
Before you sign, ensure that it is 100% accurate and complete.
Get Help If You Can’t Do It On Your Own
While your attorney can usually help you complete the form if you need help, I often refer my high net worth clients to an accountant.
The Statement of Net Worth is the blueprint of your divorce. Having an accurate picture of marital finances makes it easier to determine support and divide assets.
This is the most important document you will have to complete in your divorce. Be accurate, complete and make sure you have the documents to back up your assertions.
Have questions about your Statement of Net Worth? Contact me for a consultation today to discuss your options.