When a couple divorces, one of the key issues is determining how property and debt should be divided. Often, one spouse or the other has handled the finances in the family and the other spouse has little or no idea what assets and debts actually exist.  In the vast majority of divorce cases, we will have the parties exchange what is known as a sworn inventory and appraisement.  Sometimes you will hear this referred to as an “inventory” or an “I&A.”

An I&A is a super long form that lists out all the assets and all the debts for the community estate and each party’s separate estate.  The list includes everything from real estate to retirement plans to jewelry to airline miles and everything in between.  It also includes all types of debts, such as mortgages, car loans, student loans, and credit card debt.  For most people, many sections on the list will not apply.

An I&A is more than just a list.  It details how much the asset (or debt) is worth on a given date, how much it was worth at the time of marriage (if it existed then), identifying information for an account, the nature of the account, etc.  Often we will have the parties included supporting documents to backup the information on the inventory.  This could include the most recent statement, a current snapshot of an account, an appraisal, etc.

Each party will swear that the I&A is accurate to the best of his or her knowledge before a notary, and then the attorneys will exchange them.  Because the inventories are usually very long,  I then take the information from both inventories and put it into an excel chart.  This allows everyone to easily compare the inventories and easily move assets or debts into different columns for dividing the estate.

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In most Texas divorce cases, each party will complete a sworn inventory and appraisement and exchange it with the other side.  These inventories are generally quite helpful when it comes to dividing property and debt, especially in cases where one spouse has controlled the majority of the finances in the marriage.  In some cases, the inventory and appraisement leads to additional discovery requests where one side wants backup documentation in support of certain items listed on the inventory.  The benefit here is that the inventory usually allows discovery requests to be narrowed down to only very relevant documents.

When a client needs to complete an inventory and appraisement, I send them a blank form to complete.  It lists every imaginable asset and debt that either of the parties could have.  I tell clients to simply delete any sections that are not relevant to them so the document is easier to get through.  The inventory will include everything from real property to bank and retirement accounts to frequent flyer miles to firearms and artwork.  The party will also list a value for each item of property, along with a date for the valuation.  The inventory also includes itemized descriptions of debts, such as credit cards, student loans, mortgages, etc.  After the form has been completed and reviewed by an attorney, it must be sworn to and notarized.

In my experience, most attorneys will voluntarily agree to exchange an inventory and appraisement.  If the other side will not agree, a judge will almost universally order the parties to complete an inventory and appraisement by a certain date upon request.

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