It can be unsettling to get through a meeting with your lawyer and to learn that you have to provide your opposing party with extensive financial information. Especially if you and your ex aren’t currently in a relationship. It’s also uncomfortable to hand all that information to your lawyer, who you may not know well yet. However, this is a standard requirement in family law cases in Colorado. Specifically, the Courts require that both parties to a divorce or parental responsibilities case be financially transparent with each other and the Court.
The reason behind this policy makes sense, even though it can feel invasive of your privacy. In a divorce, the Court (and both parties) needs to know exactly what assets and debts are to be divided as part of the marital estate. If all assets and debts are not accounted for, a settlement agreement or court determination may not be equitable. Incomplete financial disclosures can also mean that the parties remain jointly responsible for a debt, which is an uncomfortable position for both parties. In case of a future bankruptcy filing, debts that haven’t been disclosed and divided may lead to complications or limitations on the release of the debts. Leaving financial loose ends is a bad idea.
In parenting cases, whether they involve a divorce or not, financial transparency is also important. The Court calculates child support based on income, but assets and debts are still relevant. If a party is hiding income, a review of bank and credit documents can reveal the financial reality. Also, some assets may generate income that needs to be included in a child support calculation.
When you begin a divorce or parenting case, be prepared to share bank statements, debt statements, tax returns, and documentation of your income. Each type of document will be relevant to dividing a marital estate or for establishing child support. Financial transparency with your ex may be uncomfortable, but it is required of both parties, and it’s necessary for a thorough and equitable ruling.