Will she be entitled to my business?

[gabes_mom]

I am the Step Mom, DH and I live in NC with our son, and the Bio Mom moved to PA with the kids (ages 8 and 6) back in 2004. We did fight the move from NC to PA but was told there was nothing we could do to stop her.

With that said...

DH and I have a business we are going to start very soon. We have decided to make Me the 100% owner of the business so that she (hopefully) will not have any claim on the business.

I can't find anywhere where she will be entitiled to any part of the business, BUT what if the business starts making a large amount of Revenue?  

Basically at what point if any will she be able to have any claim to my business and any revenue it may or may not generate?

[MixedBag]

IMHO -- O.K.???  

If Dad (or Mom -- advice is gender neutral), were to start a business and QUIT their main job, I would expect the court to impute income back to what he was making before he started this new business.  I would not expect the court to lower the current child support obligation from what it is now.

Once that business generates income, I would expect the court to say 50% of that income belongs to each of you..

Check to see if the state that has jurisdiction uses NET or GROSS income.

BTW -- My EX prints off my posts and saves them for court.

I am in a similar situation.

Put the shoe on the other foot, and put yourself in the Custodial Parent's position.  That's usually where you find your answers that focus on the children -- through empathy.

[jilly]

In NC the amount of child support is based on GROSS income.

Here's a link to the NC Child Support Guidelines effective as of October 1, 2006:

http://www.nccourts.org/Forms/Documents/981.pdf

[gabes_mom]

I appreciate your opinion and I believe you didn't completely understand my post b/c I did leave some info out and I didn't word the post that well either.

~I will be the SOLE owner of this business.

~He will indeed quit his job but by working for Me will be getting paid the same as he is now not less. So therefore would not be asking for a decrease in child support. In fact once the business begins to do better he will get a raise and will therefore be getting paid MORE and will be able to pay more in child support.

~You see I am thinking about the children, I agree with child support to a certain extent, but the fact of the matter isn't whether I agree with it. It's a fact of life.

***My concern is with this being MY business (I am sorry I really didn't word that correctly the first time I have gotten into the habit of referring to myself as "we") Will the BM have any claim whatsoever to the business and whatever revenue it may or may not generate?****

Thank you for your response!

[gabes_mom]

yeah I know it's based on gross income. Thanks for the link though.

[mistoffolees]

I would suggest that you contact an attorney. There are undoubtedly things that can be done to affect her ability access this money. For example, the business could be set up in a trust which he has no access to and where the proceeds are outside of his control. You may also need an employment contract with him that explicity states that he has no management role in the business and is purely a for-hire employee.

Even if those things can be done, I'm fairly certain that it would require very precise wording, so you'll need an attorney to set it up.

[MixedBag]

I am the SOLE owner of my business too.

Doesn't mean that a judge won't decide that 50% of my business isn't considered a community property asset available to DH (now EX#3).

See, I wasn't expecting it, and neither was DH/EX#3, and neither was his EX, her spouse, or our attorneys.  My income as STEP-PARENT was used and 50% of it was considered as an asset available to DH/EX#3.  Same thing was done to his EX's spouse.  (Different state).

You've been given some other good advice by mist....


I think your answer really lies in case law from the state has has jurisdiction because that's where our situation came from.  

Fortunately, it hurt his EX more than it hurt us, so we didn't argue how that it was all wrong.

Good luck!

[Jade]

>I am the Step Mom, DH and I live in NC with our son, and the
>Bio Mom moved to PA with the kids (ages 8 and 6) back in 2004.
>We did fight the move from NC to PA but was told there was
>nothing we could do to stop her.
>
>With that said...
>
>DH and I have a business we are going to start very soon. We
>have decided to make Me the 100% owner of the business so that
>she (hopefully) will not have any claim on the business.
>
>I can't find anywhere where she will be entitiled to any part
>of the business, BUT what if the business starts making a
>large amount of Revenue?  
>
>Basically at what point if any will she be able to have any
>claim to my business and any revenue it may or may not
>generate?

Since you will have started the business after marriage, it is considered a marital asset, even if it is in your name only.  And half of its income is your husband's.  

And I agree with Mixedbag about the imputed income.  If your husband voluntary quits a job to work for you, he will have imputed income to him.  

[mistoffolees]

>Since you will have started the business after marriage, it is
>considered a marital asset, even if it is in your name only.
>And half of its income is your husband's.  
>

That is not correct.

If the business is set up properly with a trust and if the assets and income are never mingled with joint accounts, it may be possible to set it up so it's not marital.

Even for salary income, it's possible to set it up so that a step parent's income isn't necessarily a marital asset. For a business, it should be even easier-particularly if the capital used to start the business is from assets she held before marriage.

There are too many variables to make a blanket statement like yours.

[Jade]

>
>>Since you will have started the business after marriage, it
>is
>>considered a marital asset, even if it is in your name only.
>
>>And half of its income is your husband's.  
>>
>
>That is not correct.
>
>If the business is set up properly with a trust and if the
>assets and income are never mingled with joint accounts, it
>may be possible to set it up so it's not marital.
>
>Even for salary income, it's possible to set it up so that a
>step parent's income isn't necessarily a marital asset. For a
>business, it should be even easier-particularly if the capital
>used to start the business is from assets she held before
>marriage.
>
>There are too many variables to make a blanket statement like
>yours.

Okay, what happens if they get a divorce?  The business was started during the marriage, he quit his job to help get the business established.  Just how is the start up funded?  

Any decent lawyer would be able to make a very good case that it is a marital asset since it was formed after they were married and not  before.  Now, if she were to start the business and he didn't quit his job and help her with the business, they may be able to get away with it.  But that isn't the plan.