Financial disclosures are the backbone of fairness in Los Angeles and Orange County divorces. They ensure that both parties have the same understanding of both the assets and liabilities that were part of the marriage. Unfortunately, all too often the information is not accurate either because of inadvertent mistakes or purposeful concealment.
National survey data and expert commentary indicate that financial disclosure errors—ranging from honest mistakes to intentional concealment—are widespread. Nationally, about 25% of divorcees admit to hiding assets during marriage or divorce, and 39–43% of adults with combined finances report some form of financial deception. There are no official statistics from California or Los Angeles County courts on how often financial disclosures are improperly done in divorce cases. However, the State Bar of California believes that most disclosure errors are attributed to honest mistakes, especially among self-represented litigants.
This three part blog series is designed to help you understand what the financial disclosure requirements are and how to effectively comply with them. The importance of compliance is more than simply fundamental fairness, the Courts have levied severe penalties for mistakes, especially when they seem intentional.
In blog one we are simply going to share the basic requirements and why it is so vitally important that you take the financial disclosure requirement seriously and share the information completely and accurately. We will discuss the real world ramifications for either ignoring this admonition or blatantly misrepresenting your situation.
In the second blog of this series will discuss in detail the actual requirements and how to set yourself up for success at the start of your divorce proceedings.
Finally in part three of this series, we will cover the service process, the 60-day and 45-day deadlines, the continuing duty to update, and what the Family Code does to a spouse who leaves something off.
Disclaimer: This blog constitutes general information and is not legal advice. This platform is not a law firm, and its employees, agents, or representatives are not acting as your attorney. The content and tools offered are intended to assist individuals in understanding and navigating the divorce process without an attorney but are not a substitute for advice from a qualified attorney licensed in your jurisdiction. To allow you to independently verify information, wherever a fact appears below, you'll find a link to the statute, court rule, or source behind it.
In every Los Angeles County divorce, California law requires both spouses to complete a rigorous two-stage financial disclosure process. This involves serving a preliminary declaration of disclosure—including forms like the Schedule of Assets and Debts (FL-142) and the Income and Expense Declaration (FL-150)—within 60 days of filing or responding to the divorce petition. Before the divorce is finalized, a final declaration of disclosure (unless properly waived) must also be exchanged, updating all financial information.
To protect the privacy of the couple, these financial disclosures are only exchanged between the parties and are not filed with the court. Instead you must file with the Court a proof of service (FL-141) to confirm you complied with the financial disclosure requirements.
This process is designed to ensure that both parties have a complete and accurate picture of all assets, debts, income, and expenses, so that property division and support decisions are fair and transparent.
One of the issues that often delay a divorce are when mistakes are made in the Financial Disclosure requirements. All too often these mistakes can lead to delays, sanctions, and even the setting aside of divorce judgments in Los Angeles or Orange Counties.
Not all failure to disclose is intentional, common mistakes can lead to incomplete, inaccurate, or late disclosures. Among the most common reasons disclosure requirements fail are:
California imposes a strict fiduciary duty on spouses, requiring the highest good faith and full transparency throughout the divorce process. Failure to comply can result in severe penalties: courts are required to impose monetary sanctions and attorney’s fees for noncompliance, and in cases of intentional concealment, a spouse can lose 50%—or even 100%—of any undisclosed asset. Does this actually happen? Real-world cases says it does.
In re Marriage of Rossi In a dissolution case, Denise Rossi intentionally concealed the lottery winnings from husband and that her conduct constituted fraud within the meaning of Civil Code section 3294. The court specifically found that Denise's failure to disclose the lottery winnings constituted fraud, oppression and malice within the meaning of Civil Code and awarded her husband one hundred percent ($1.3 million) of the lottery winnings.
In re Marriage of Feldman In this dissolution of marriage proceedings the court found that the husband failed to disclose several different financial transactions, including the purchase of a personal residence through one of his companies, the purchase of a $1 million bond, the existence of a 401(k) account. The Court awarded sanctions of nearly $390,000 for the failure to disclose.
In short, accurate and timely financial disclosures are not just a bureaucratic hurdle—they are a legal and ethical obligation with lasting consequences for both parties. Even years after a divorce is finalized, a judgment can be set aside if material nondisclosure is discovered
Most divorce paperwork in California doesn't get rejected over a disagreement about community property theory. It gets rejected because the Schedule of Assets and Debts says "unknown" in eleven value fields, the mortgage statement was never attached, and the Income and Expense Declaration lists monthly groceries has a suspicious number.
California requires both spouses to hand each other a complete financial picture. Not a summary. Not the parts that help your case. Everything you own, everything you owe, everything you earn, everything you spend, and the paper that backs it up. The Legislature wrote this requirement into the Family Code specifically to stop people from concealing assets and to cut down on the cost of fighting over what's on the table (Cal. Fam. Code § 2100).
What Next
This overview is simply a summary designed to impart the importance of the financial disclosure requirements. In the next blog we will drill down on the three forms at the center of it are FL-140, FL-142, and FL-150.
And again: this article is general information about California law not legal advice for your situation.
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