Financial disclosure is a required part of most California divorce and legal separation proceedings. Early in the case, each spouse generally must provide the other with a Preliminary Declaration of Disclosure containing information about assets, debts, income, and expenses. These disclosures help establish the financial picture of the marriage before the parties negotiate a property settlement or ask the family court to resolve disputed financial issues.

Preliminary Disclosures Identify Assets and Debts

A Preliminary Declaration of Disclosure is designed to identify the financial interests and obligations that may need to be addressed during the case.

Each spouse generally must identify all assets in which that spouse has or may have an interest and all liabilities for which that spouse is or may be responsible. The disclosure obligation applies regardless of whether the spouse believes an item is community property, separate property, or another type of marital property.

This is an important distinction. A spouse should not leave an asset off the disclosure simply because that spouse believes the asset belongs entirely to them.

The preliminary disclosure must provide enough information to reasonably identify the assets and liabilities. When property or a liability is not owned or owed solely by one or both spouses, the disclosure must also address the declarant’s percentage of ownership or responsibility.

The spouse may also state how they believe a particular asset or debt should be characterized, although characterization may ultimately remain disputed.

Income, Expenses, and Tax Returns Are Also Part of the Process

The preliminary disclosure process extends beyond listing property.

The required materials generally include a current Income and Expense Declaration unless a current and valid one has already been provided. This gives the other spouse information concerning income, expenses, and other financial circumstances that may be relevant to support and settlement discussions.

The disclosure must also include tax returns filed by the spouse during the two years preceding service of the declaration.

A common misconception is that the preliminary disclosure must contain a final valuation for every asset and the exact amount of every obligation.

The preliminary stage primarily focuses on identifying the assets and liabilities. The more extensive requirement to provide all material information concerning valuation of community assets and amounts of community obligations applies to final disclosure requirements.

When valuation information is already available, however, providing it can help the parties understand the financial issues earlier in the case.

There Are Deadlines for Serving Preliminary Disclosures

The petitioner generally must serve the Preliminary Declaration of Disclosure with the petition or within 60 days after filing the petition.

The respondent generally must serve their disclosure with the response or within 60 days after filing the response.

Those time periods may be extended through a written agreement or court order.

The declaration itself generally is not filed with the family court. Instead, the appropriate proof showing that the disclosure was served is filed with the court.

Preliminary disclosure requirements also remain important in a default divorce. A petitioner generally cannot avoid the disclosure process simply because the respondent failed to participate in the case.

California also imposes a continuing obligation to update and augment disclosures when material financial information changes. Completing the preliminary disclosure therefore does not necessarily end a spouse’s disclosure responsibilities for the remainder of the case.

Early Financial Disclosure Creates the Foundation for Property and Support Decisions

Preliminary Declarations of Disclosure provide both spouses with important financial information near the beginning of a California divorce or legal separation. By identifying assets, liabilities, income, expenses, and other required financial information, the process helps establish what must ultimately be resolved through agreement or family court proceedings. Complete disclosure is a legal obligation, not simply an optional exchange of financial information.