What Financial Documentation Do You Need When You File Divorce?

If you have found yourself thinking about divorce, it is common to feel overwhelmed at the prospect. Many people put off ending a marriage they know in their hearts is over out of fear. Divorce certainly seems frightening, especially with how many anecdotal horror stories are out there.

It's important to never take other people's biased version of their divorce too literally. Many people tend to exaggerate their stories to elicit sympathy or defer any personal blame. Stories exceptional or dramatic enough to attract the media are likewise uncommon. You shouldn't let your fear or nerves related to divorce deter you from pursuing the new beginning you know will be best for you.

However, just like you don't want to procrastinate, you also don't want to jump into a divorce unprepared. You will need to take certain steps to get ready for divorce. Gathering financial records is an important first step.

You need copies of tax and income records

Unless you signed a prenuptial agreement allocating each individual's income to that individual and not the household, you need to know the accurate income amounts for both you and your spouse during your marriage. The courts will need to review these figures, along with an inventory of your assets and debts, to determine how to split up what you own.

You should also look into any documentation of employer-sponsored retirement plans and pensions. Any amount contributed to those accounts, including employer matching amounts, will factor into your household assets. If you don't know those figures, it is hard to ask for a fair split of your assets.

Credit card receipts and daily financial records could help as well

If you expect a smooth divorce with zero financial complications, your basic income and tax documentation may be sufficient financial records. However, if you suspect there is any potential for your ex to engage in ethically questionable financial practices during the divorce, more scrutiny may be in your best interest.

For example, looking over credit card statements over the last few months can help you determine if your ex has started spending more frivolously as the marriage deteriorates. Similarly, if your divorce is the result of an extramarital affair, examining financial records can help you determine if any marital assets got spent on the affair. In that situation, you may have a case of dissipation, which can substantially impact how the courts split your assets.

You may also want to look for any sign that your spouse has been hiding assets, such as a secret savings account or bank account, instead of sharing it as part of the marital assets. Couples with larger overall marital estates are more likely to engage in financial revenge tactics. The more thorough the records that you keep for yourself, the better your chances of catching such issues early in the divorce process.