QUESTION

Is my soon to be ex wife entitled to half of my business?

Asked on Dec 31st, 2013 on Divorce - California
More details to this question:
My wife and I are signing a separation agreement as it relates to the child support and spousal support. Retirement accounts and business will be settled at time the divorce is finalized I guess. My question is this. I wanted to start a side business and my wife laughed at the idea and said she wanted nothing to do with it and would not agree to let me use our funds to start it. So I had to take a $3,000 loan from a family member to get it started. The start up loan has been paid back. The business is a sole proprietorship where I am doing business under an assumed name. I do not have to file separate tax forms or anything I just show the expenses as deductions and the profits show as my personal income. The income that comes from that and the full time job have all been included in determining support. Can she ask or is she also entitled to 1/2 the business (which is actually just me) forever? I teach driving classes and the students pay the fee to me directly, there is no LLC or Corp. or assets other than a printer.
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6 ANSWERS

Business Law Attorney serving Bingham Farms, MI at James T. Weiner, P.C.
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She might be entitled to 1/2 of its value.. but what is its value? it is its value .. not its income forever that she can ask for. Determining the value of a business like this is a job for a professional business appraiser (they are few and far between and relatively expensive) so.. An easy way to look at it is: If you choose to stop teaching driving is the business worth anything? So the value is nothing without your services. and she gets the value of your services in child support calculations.
Answered on Jan 03rd, 2014 at 2:53 PM

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Social Security Disability Attorney serving Melbourne, FL at Law Office of Robert E. McCall
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There is no yes/no answer. This is an issue for the Judge to decide.
Answered on Jan 03rd, 2014 at 2:52 PM

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Commercial Contracts Attorney serving Boise, ID at Peters Law, PLLC
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Probably not. First, because of the way you started it, it may be deemed to be your sole and separate property, which would mean she has no rights in it. If it is not your sole and separate property, then she would be entitled to one-half of its value now. Based on a number of factors, the primary one being that if you don't accept students, there is no value, I cannot imagine that there is much worth in the business. Regardless, talk with your attorney about the issue. He or she is best able to give you an idea how this will be handled.
Answered on Jan 03rd, 2014 at 2:51 PM

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Family Attorney serving Sacramento, CA at Peyton & Associates
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Your problem is that anything "acquired" during marriage is treated as community property and its value is subject to equal division. You may need to have the "side" business appraised to determine it net equitable value. I *strongly* urge you to get an attorney to guide you through what is a complicated process.
Answered on Jan 03rd, 2014 at 11:39 AM

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Divorce & Family Law Attorney serving Salt Lake City, UT at Utah Family Law LC
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A spouse can, under certain circumstances, be found to have an interest in a business started during the marriage. Here are a few notes from cases (not an exhaustive list) you might find informative: *Jensen v. Jensen, 203 P.3d 1020 (Utah.App.,2009)* Wife was not entitled to one-half of the increased equity in closely-held family corporation, of which husband was president and partial owner; wife did not assist in running the business nor contribute in any way to its increase in equity, and it was unclear whether the increase in equity was due to anything other than inflation. *Dunn v. Dunn, 802 P.2d 1314 (Utah.App.,1990)* Professional corporation was marital asset subject to equitable distribution where corporation was founded and its assets accrued during marriage, former wife performed bookkeeping and secretarial services without pay for corporation, former husband worked 60 to 70 hours per week at corporation leaving wife with sole responsibilities of running household and managing household accounts, and wife was left without husband's companionship and domestic contributions while he worked long hours for corporation; wife was partner in business of marriage and her efforts were necessary contribution to growth of his practice and business. *Huck v. Huck, 734 P.2d 417 (Utah,1986)* Finding that rental properties acquired by husband during marriage were marital property was supported by evidence that property could not have been acquired by husband without wife's contribution toward household expenses. *Dogu v. Dogu, 652 P.2d 1308 (Utah,1982)* In divorce action, trial court did not abuse its discretion in awarding husband as his separate property the entire interest in his professional corporation, of which he was sole shareholder and the only employee and from which he drew salary and bonuses as needed. *Child v. Child, 194 P.3d 205 (Utah.App.,2008)* Appreciation of husband's ownership share in rental business was his separate property, and therefore, not part of marital estate; husband owned a 25-percent interest in rental business prior to his marriage to wife, and no subsequent actions by husband or wife rendered husband's ownership share part of the marital estate. *Whitehead v. Whitehead, 836 P.2d 814 (Utah.App.,1992)* Assets of janitorial business which had been owned by former wife and former husband were not marital assets and, thus, former wife could not receive share of assets upon divorce despite her claim that assets were improperly transferred to former husband's father. *Elman v. Elman, 45 P.3d 176 (Utah.App.,2002)* A trial court has considerable discretion concerning property division in a divorce proceeding, and thus, its actions enjoy a presumption of validity. Appellate court will disturb a trial court's property division and valuation only when there is a misunderstanding or misapplication of the law resulting in substantial and prejudicial error, the evidence clearly preponderates against the findings, or such a serious inequity has resulted as to manifest a clear abuse of discretion. In distributing property in divorce proceedings, trial courts are first required to properly categorize the parties' property as marital or separate. Generally, trial courts are required to award premarital property, and appreciation on that property, to the spouse who brought the property into the marriage. Because wife's efforts freed husband to grow his premarital partnership interests, and he was entitled to one-half of the marital assets wife grew, equity required that wife receive a fair share of the appreciation on husband's premarital partnership interests, prorated based on the number of years of husband's most active partnership management. The court may award the separate property of one spouse to the other spouse in extraordinary situations where equity so demands. *Colman v. Colman, 743 P.2d 782 (Utah.App.,1987)* Trial court did not abuse its discretion in dividing property after piercing corpo
Answered on Jan 03rd, 2014 at 11:30 AM

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Short answer is probably, but negotiation is possible to award entire thing to you seek and attorney's advice.
Answered on Jan 03rd, 2014 at 11:29 AM

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