Started a business 20 years ago with three partners . I own 25% . My wife agreed that she doesn't want any of the business .

Asked over 1 year ago - Chino Hills, CA

Is this legal in California to just pay off my salary and not my profit shares for they're not guaranteed.

Attorney answers (3)

  1. Michael Charles Doland

    Contributor Level 20

    5

    Lawyers agree

    Answered . You can covert separate into community property and visa versa through a transmutation agreement. I cannot understand your final sentence.

    The above is general legal and business analysis. It is not "legal advice" but analysis, and different lawyers may... more
  2. Armen Garabedian

    Contributor Level 7

    2

    Lawyers agree

    Answered . It's not clear whether your question is about your wife's interest in the company or distributions to you based on the company's structure and agreements among the partners.

    THIS IS NOT LEGAL ADVICE. INFORMATIONAL PURPOSES ONLY. Legal matters are like thumbprints, no two are identical.... more
  3. Victor Look

    Contributor Level 9

    2

    Lawyers agree

    Answered . In California, all assets and income derived or obtained or derived during the course of a marriage is considered "community property", of which your spouse has a 50% interest in. Unless there is an agreement in writing to the contrary, your wife has a 50% interest in the 25% interest of the business that you own with the three other partners.

    The salary you are paid from the business is considered community property, so are the profits and losses from the business. Therefore, your wife has a 50% interest in the salary you are paid, and a 50% interest in the profits/losses from 25% of the business as a whole.

    The opinions published on this forum should not be construed as creating an attorney-client relationship for any... more

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