How a community property interest is calculated in a separate property business
Is the business capital intensive or service intensive?A service intensive business is almost solely dependent on the efforts of the owner. An example of this kind of business would be a solo practitioner doctor or lawyer. Capital intensive business may have a strong leader, but the output of the business is mainly dependent on the in-place operations.
Community interest in service intensive businessesIf the business is service intensive the courts will determine the value of the business at the date of marriage and the value of the business at the date of valuation (trial or separation as the case may be). The court will attribute an interest rate to the value as of the date of marriage -- "the usual interest on a long investment well secured" and subtract that total from the value at trial. That number is the community's interest.
Capital intensive businessThe separatizer is favored in this calculation which looks to see if the community was reasonable compensated during the marriage. If the community did not receive reasonable compensation, the owner spouse will owe the community money.