I understand. No, in this case they cannot exclude him as the 50% business owner simply because you are the one that is writing off the business - that is not indicative of who owes it, alone. It WOULD be a good idea for him to do some deductions, but here, there is no law that addresses this per se. If they press the issue, what you have to do is to file a PETITION FOR DECLARATORY JUDGMENT
under Calif.Code.Civ.Proc. § 1060-1062.5. A Declaratory Judgment is a judgment by the Court that interprets confusing situations and contracts
and declares the rights, duties, or obligations of said situation. In short, it’s a kind of petition which basically says "Judge, here is what happened, now it’s a mess and not clear, so can you please fill in the blanks for us with what is contractually fair and legally equitable and make everyone bound by it?"The good thing is that half the time, when the opposing party gets served, they either will contact you and offer a compromise or just give up, because people are both (1) afraid of the legal system and (2) do not have the time and money to deal with an issue.
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