If I use inherited money to start a business then get a divorce later, will my partner receive half of the business assets?
Get Legal Help Today
Compare Quotes From Top Companies and Save
Secured with SHA-256 Encryption
If I use inherited money to start a business then get a divorce later, will my partner receive half of the business assets?
Asked on October 15, 2011 under Family Law, California
Answers:
S.L,. Member, California Bar / FreeAdvice Contributing Attorney
Answered 12 years ago | Contributor
Separate property is property acquired before marriage or after the marriage ends.
Community property is property acquired during marriage.
Although generally separate property is income or property acquired before marriage or after the marriage ends, an inheritance is your separate property even if you inherit the money during marriage. Using your inheritance to start a business means that the business is your separate property because the funds used to start the business were separate property. If only your inheritance is used in the business, your spouse has no claim to the business because the business is separate property. However, if you invest community property funds in the business, the community is entitled to reimbursement and your spouse would have a claim representing that portion of the community property funds that were used in the business. If a portion of the business assets are traceable to community property funds, then your spouse would have a claim for half of the portion of the community property funds that are represented by the assets. This does not mean half the assets, but half the portion of community property funds that would be represented by a proportionate share of the assets. Again, if no community property funds are invested in the business, then your spouse has no claim because the business is your separate property.
IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.