If my hopefully soon to be ex has a corporation that hasnt made and money and has debt is that actually considered community property/liability? I was an officer of the company for only about 1 year before i had a notiarized statement removing myself. We also have had seperate checking accounts since 2002. Business was established in 2000 to 2001.
If the business was formed during the marriage, it would be considered community property. The same holds true with the debt - if it was incurred during the marriage, it would be consider a community debt. All community property and debt is subject to division by the Court. Keep in mind that the Court will consider how the debt was incurred, and who incurred it, when making a division.
Amy Lambert is an excellent family law attorney in Austin. Give her a call (512) 472-1919.
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The Corporation owns the debt if it is a separate entity. Is it still operating or is it being terminated? Is it "upside-down?" Is the corporation going to declare bankruptcy? Who is getting the corporation in the divorce? You have too many unanswered questions in your posting. Perhaps you should consider consulting with an attorney about this matter. Many attorneys in this area will give you a free consultation.
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A major plus of a corporation is that its owners called shareholders are not liable for the debts incurred by the corporation. So your wife is not personally liable for the debts of the corporation and thus you are not either. However, any personal guarantees that your wife made to the corporation or third parties on behalf of the corporation will be a considered a her debt if the corporation is unable to satisfy those debts. For example, if your wife took out a loan for the corp. and personally guaranteed it or put up your community property as collateral, she will be personally liable for payment if the bank goes after the corp. and finds no money there. In that case, you and your wife's community property would be at stake.