Under California divorce laws, when a married couple divorces, their community assets and debts will be divided equally. This means that they will be divided fairly and equitably. Nine states (Arizona, California, Louisiana, Idaho, Nevada, New Mexico, Texas, Washington, and Wisconsin) have what are known as community property laws, which divide marital property equally after divorce. Marital assets are generally defined as all income, assets, and debts acquired during marriage.
That property is considered equal property of both spouses and will therefore be fairly distributed after the divorce, with a couple of caveats. Assets that will be divided in a community property state exclude those that were acquired before the marital union and after a legal separation. Gifts or inheritances received by one spouse are also excluded from being divided equally between divorcing parties. In every divorce, a couple's assets and debts must be divided between them.
But each of the spouses will keep their own assets separately and will be liable for their own debts separately. Know the difference between marital and separate property. If one spouse is supposed to receive half of the business, it is possible for the other spouse to buy them if both spouses agree. In general, the amount that would be required to be paid would be much more than just the cost of half the business based on the valuation of the business.
The reason for this is that the business will continue to generate income, and the buying spouse would lose that income because they are no longer part of the business. Payment of the present value of the business may be required plus what the spouse could have expected to earn. Of course, this will also be less of the company's debts or liabilities. If the business you're concerned about is a business you inherited from your parents, your ex is not entitled to half of the company's assets.
A wife in California may be entitled to up to half of the marriage assets along with up to 40% of her partner's income for child support, spousal support, and primary child custody. Knowing what you are entitled to in a divorce is vital to protecting yourself and making sure you get what you deserve. In fact, families with more than one young child can quickly discover that keeping children in daycare costs more than the family would with the wife working, resulting in a decision for her to stay home. If you added your spouse to the company incorporation documentation, gave him a title, and allowed your spouse to have control in business proceedings, you may be entitled to some of the assets.
If you have shared the business closely with your wife for many years, it would be unrealistic for you to expect to keep everything when you divorce. Going through a divorce can be a stressful and overwhelming process, but knowing what you're entitled to will help make sure you get what you deserve in your divorce. In a divorce, the wife is entitled to 40% of all assets accumulated during the marriage, unless a court order says otherwise. While your former spouse may be entitled to financial compensation, it will be in your best interest to maintain control over a successful business.
He or she can then more easily determine if you should receive your entire business or if your spouse is entitled to a share of it, up to and including half of it.