Del Mar is one of the smallest but most beautiful and most affluent places in the San Diego metropolitan area. The area is famous for thoroughbred horse racing, and there are many thriving large, and small, family-owned businesses in the area. If you own a business with your spouse and you are planning to divorce, it is crucial to speak with an experienced Del Mar business division in divorce lawyer as quickly as possible.
Experienced Legal Counsel for Business Division in Divorce in Del Mar, CA
The team at Neumann Family Law, A.P.C., has years of proven experience handling some of the most challenging divorce cases in Del Mar and surrounding areas of California. Divorce is always a challenging experience, but the financial aspects of dissolution are often far more complex for business owners. Whether you own your own business or co-own a business with your spouse, it is natural to worry about how your divorce may affect your business interests.
The Public Policy Institute of California reported that as of 2023, there were more than 1.7 million private-sector businesses operating in California. A recent study from 2021 estimated that more than 297,000 businesses and employer firms throughout the United States are jointly owned and operated by spouses, meaning that more than 10% of all for-profit businesses in the United States are operated by married couples.
Owning and operating a business with your partner can be incredibly rewarding, but if you decide to end your marriage, dividing business assets can be a difficult and contentious process. The team at Neumann Family Law, A.P.C., can provide comprehensive legal support for all stages of this process and help you make more informed decisions when it comes to property division in your divorce.
Understanding California’s Community Property Law for Divorce
Property division is one of the most important elements of any divorce, and California upholds the community property standard. This means that all the property controlled by divorcing spouses must be characterized, valued, and divided equally in their divorce. Each spouse has the right to claim separate property, but only certain types of property may be claimed in this manner.
Separate property can be anything a divorcing spouse owned prior to their marriage, gifts given to them during their marriage, and anything they have inherited from their parents and other relatives. In some cases, separate property can be transmuted to community property during marriage. For example, if you owned your home before marriage but your spouse helped make mortgage payments and/or paid for renovations, the house may qualify as community property.
When it comes to the characterization of a business in divorce, it will likely qualify as community property if both spouses ran the business or if one spouse contributed to the business during the marriage, even if the other spouse owned it before they were married. Your Del Mar business division in divorce lawyer can help you resolve any disputes as to whether the business qualifies as separate or community property.
After characterizing the business, all assets and debts must be valued accurately. This can be a difficult process without an attorney’s help. The value of a business as a whole generally depends on the total value of the business’s assets against the total of the business’s debts. Most businesses control both tangible and intangible assets.
Tangible business assets can include property, inventory, cash on hand, and accounts receivable, while intangible assets typically include goodwill, patents, intellectual property, and business relationships. Your attorney can not only help you determine the value of all your business’s tangible and intangible assets but also accurately evaluate debts.
It is important to remember that under California’s community property law, both assets and debts can qualify as community property. If you are seeking sole ownership over your business out of your divorce, you must remember that this will require assuming responsibility for the business’s debts as well as its assets.
Dividing Your Business in Your Del Mar Divorce
You may have more options for dividing your business under the community property law than you initially expected:
- One spouse may wish to buy out the other spouse’s share of the business. They may be willing to offer a cash payment for half of the business’s value or put up other community property equal to half of the business’s value. This would allow one spouse to maintain sole ownership of the business after their divorce.
- The spouses may choose to liquidate the business or sell it and divide the proceeds. This will require settling all debts with the business’s creditors first, and then any remaining proceeds will be evenly divided between the spouses.
- The divorcing spouses could choose to continue operating the business as co-owners after their divorce. In this situation, they would need to draft a new operating agreement.
Ultimately, dividing your business in divorce is just one of many contentious issues you and your spouse will need to resolve. The team at Neumann Family Law, A.P.C., excels at representing clients in complex, high-asset divorce cases, and we are prepared to do everything we can to allow you to approach your divorce proceedings with confidence.
Find Your Del Mar Business Division in Divorce Lawyer Today
Neumann Family Law, A.P.C., takes time to learn as much as we can about each client we represent. We can not only assist you with the business aspects of your divorce, but you can also rely on us to assist with child custody determination and all other issues you must address in your divorce proceedings. We develop individualized case strategies to suit each client’s unique needs and goals for their divorce cases in Del Mar.
Divorce can be a very difficult and time-consuming process, especially when dividing a business with your spouse. If you want to resolve your divorce efficiently, it is crucial to consult an experienced Del Mar business division in divorce lawyer at your first opportunity. Once you have decided to divorce, contact Neumann Family Law, A.P.C., to schedule a consultation with our team and learn more about the legal services we can provide in this challenging situation.
*CFLS = Certified Family Law Specialist by the State Bar of California Board of Legal Specialization
