If I funded a business owned by my wife and I with assets that I owned prior to our divorce, am I entitled to any of these prior owned assets?
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If I funded a business owned by my wife and I with assets that I owned prior to our divorce, am I entitled to any of these prior owned assets?
We have had the business for 3 years and we both own the business 50/50.
Asked on May 5, 2012 under Family Law, Maryland
Answers:
S.L,. Member, California Bar / FreeAdvice Contributing Attorney
Answered 11 years ago | Contributor
If you live in a community property state, community property is property acquired during marriage. Community property also includes income during marriage. Each spouse has a one half interest in the community property.
Separate property is property acquired before marriage or after the marriage ends. Separate property also includes income before marriage or after the marriage ends. A spouse has no claim to the other spouse's separate property.
Since the business is owned by you and your wife during marriage, it is community property and each spouse has a one half interest. If the assets you acquired prior to divorce were acquired during marriage, they are community prooperty and you and your spouse each have a one half interest in the assets as community property.
If the assets were acquired by you prior to marriage, the assets are your separate property and although the assets were used to fund the business, you would be entitled to reimbursement of the assets as they are your separate property. The assets if traceable to their separate property source are your separate property. If the assets have been co-mingled with the community property business they funded and cannot be traced to their separate property source, then there is a rebuttable presumption that the co-mingled funds are community property.
If you don't live in a community property state, other rules may be applicable.
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