Mandatory Financial Disclosures in a Massachusetts Divorce

  • By:Karpenski & Schmelkin

During the divorce process in Massachusetts, there are many discovery tools available to the parties. Discovery in an action for divorce allows a party to request and receive important and relevant information and documents from the other party. Engaging in discovery helps a party build his/her case for negotiations and in the courtroom.

There are two (2) mandatory forms of discovery in an action for divorce, whether contested or uncontested, in Massachusetts, which are required to be exchange within forty-five (45) days of the date of service on the complaint for divorce.

Rule 401 Financial Statement:

The first form of discovery is the exchange of the Rule 401 Financial Statement. There are two versions of the Statement: a short form and a long form. The short form is to be filled out by those who have an income of less than $75,000 annually. The long form is to be filled out by those who have an income of $75,000 or more annually.

The financial statement consists of the following sections; Personal Information, Gross Weekly Income, Weekly Expenses, Counsel Fees, Assets, and Liabilities. If either party is self-employed or has an interest in a business, he/she is required to also complete and file the Schedule A which consists of the party’s monthly gross receipts and monthly business expenses. In addition, if either party has an interest in rental producing property, he/she is required to also complete and file the Schedule B which consists of the party’s rent received and rental expenses. Both the short and long form are signed under the pains pf perjury.

Both the short form and long form as well as Schedule A and Schedule B can be found here.

Rule 410 Mandatory self-disclosure:

In addition to the Financial Statement, pursuant to Supplemental Probate and Family Court Rule 410: Mandatory self disclosure, except as otherwise agreed by the parties or ordered by the court, each party shall deliver to the other party or parties within 45 days from the date of service of the summons additional documents including:

• The parties’ federal and state income tax returns and schedules for the past three (3) years and any non- public, limited partnership and privately held corporate returns for any entity in which either party has an interest together with all supporting documentation for tax returns, including but not limited to W-2’s, 1099’s 1098’s, K- 1, Schedule C and Schedule E.
• The four (4) most recent pay stubs from each employer for whom the party worked.
• Documentation regarding the cost and nature of available health insurance coverage.
• Statements for the past three (3) years for all bank accounts held in the name of either party individually or jointly, or in the name of another person for the benefit of either party, or held by either party for the benefit of the parties’ minor child(ren).
• Statements for the past three (3) years for any securities, stocks, bonds, notes or obligations, certificates of deposit owned or held by either party or held by either party for the benefit of the parties’ minor child(ren), 401K statements, IRA statements, and pension plan statements for all accounts listed on the 401 financial statement.
• Copies of any loan or mortgage applications made, prepared or submitted by either party within the last three (3) years prior to the filing of the complaint.
• Copies of any financial statement and/or statement of assets and liabilities prepared by either party within the last three (3) years prior to the filing of the complaint.

It is in the interest of both parties to provide full transparency and disclosure when preparing the Rule 401 Financial Statement and disclosing the Rule 410 documents. The exchange of the Rule 410 documents allows a party find out information about the other party’s financial conduct over the prior three (3) years. If either party has engaged in financial misconduct, such as, transferring, selling, encumbering or otherwise disposing or hiding an asset, that misconduct can easily come to light and affect the division of the marital assets.

When both parties are compliant and provide information in a timely manner, it keeps the divorce process moving. Prolonging the process will only cost more time and money in the long run.

Discovery, including the mandatory disclosures, often involves complex issues that may become overwhelming for a party who is not represented by an attorney. It is important to hire an experience Divorce and Family Law Attorney who is familiar with the common discovery issues. Contact us today to schedule a consultation and learn more about the common discovery pitfalls and how we can advocate for you.

Posted in: Divorce