HOW TO FILL OUT AN INCOME AND EXPENSE DECLARATION OR FL – 150

Experienced Bay Area family law attorneys will tell clients that money is one of the most difficult and important aspects of divorce in California.  Your Income and Expense declaration or FL 150 may be the single most important document for your dissolution. This post explains why reporting your current earned and passive income accurately can make a huge difference in the outcome of your case.

If your case does not involve a request for spousal support or attorneys fees, there are 15 Items that you must fill out on an Income and Expense Declaration.

Before you start to fill this form out you should gather the following documents: (1) recent pay stub, (2) tax returns, (3) retirement accounts, (4) income from any rental properties, (5) monthly budget or expenses.  

1.    EMPLOYMENT INFORMATION:  Take this information directly from your pay stub. 

2.    AGE AND EDUCATION: Basic personal identifying information.

3.    TAX INFORMATION:  Take this information directly from your tax return.

4.    OTHER PARTY’S INCOME: It is best to be as accurate as possible. Ask for your ex-spouses pay stub.

5.    INCOME:

a.     Salary – Gross salary is what you make before taxes.  This is your immediate prospective earnings. You should put the amount per month and the average amount over the past 12 months. Remember to use gross figures (before taxes).  

b.    Overtime --- Any income earned over your assigned duties.

c.     Commissions or bonus income --- Click on this text for my post about bonus income. You will want to be very clear about how your commission scheme works and may want to speak with an attorney to optimize your outcomes.

d.    Public Assistance – This includes social security income.

e.    The remaining questions are self explanatory and specific to each situation – we recommend that you speak with an attorney if your questions are in these categories.

6.    INVESTMENT INCOME: Rental property income is income reduced by expenditures (which includes property taxes, maintenance, and hours managing property). Family Code Section 4508(2). Click on this text for my post on rental income in a divorce. 

7.    INCOME FROM SELF EMPLOYMENT: If this applies to your case, the information can be found on Schedule C of your tax returns. 

8.    ADDITIONAL INCOME: Lottery income, consistent payments from family, and income from Uber are all reportable.

9.    Change in income: If your financial situation has changed, use this section to explain why.

10. DEDUCTIONS: This information is found on your paystub. Many employers have discretionary retirement contributions, such as 401k contributions. Don't include your 401k contributions here, only include mandatory contributions such as a government pension. 

11. ASSETS: This information is found by looking at your bank statements, stock holdings, and real estate.  NOTE: You must fill out Section 11 correctly if you are going to request attorney's fees. 

12. PEOPLE LIVING WITH ME:  Spousal support can be impacted based on who lives with you. For example, if you are the supporting spouse and you have a new dependent, then you may have to pay less in support. The same goes if you are a supported spouse and you do not pay rent because someone else is paying your expenses in your home. That may impact your spousal support amount.

13. AVERAGE MONTHLY EXPENSES:

a.     Mortgage: If you have an adjustable rate mortgage, indicate what you expect the payments will be for the next 6 months. Determine the amount of principal and interest included in the monthly payment – this impacts tax deductions and net spendable income. Make sure you are including property taxes and property insurance. You may need to estimate the reasonable amount for repairs and upkeep (remember to include your gardener, pool service, and housekeeper).

b.    Health care: These are costs that are not paid by insurance. Include here your monthly prescriptions.

c.     Child care:  This includes aftercare, preschool, nanny, summer child care.  

d.    Groceries:  An average family spends $600 a month on groceries.

e.    Eating out: An average family spends $300 a month on eating out.

f.      Utilities: Use your bills to make this entry.

g.    Telephone:  Do not include business related telephone expenses.

h.     The second half of the categories are self explanatory and are not necessarily strategic with the exception of “n” savings and investments. There are some spousal support cases, which establish that the marital standard of living must be calculated by looking at the pattern of saving. The types of expenses that can go in “other” include hair cuts, pet care, memberships.

14.  INSTALLMENT PAYMENTS: Use your loan and credit card statements for this step.

15. ATTORNEY’S FEES: Enter the total amount you have paid thus far to an attorney. You must fill section 11 and 15 out correctly to get attorney's fees. 

If any of the following situations apply to your story, consider speaking with an attorney: (1) you have received gift income, (2) there are non-income producing assets, (3) one spouse is not working but they have a high earning capacity, (4) you or your spouse are able to generate income from investments, (5) there is a great disparity in income such that the other spouse’s lifestyle far exceeds that of yours. 

Contact amanda@gordonfamilylaw.com for more information.