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If there is a personal judgement against me, can they go after my "S" Corp bank account?

Chino, CA |
Filed under: S-corporation

I am on the bank account, and am an officer of the corporation, is there any chance or way they can attach to it? The corporation and I are based in California.
Thanks

Attorney Answers 4

Posted

Yes. Without knowing the specifics of your situation and without getting into the specifics regarding the procedures in California which are available to a judgment creditor, the answer is yes.

The information presented here is general in nature and is not intended, nor should be construed, as legal advice. This posting does not create any attorney-client relationship with the author (who is only admitted to practice law in the State of California). For specific advice about your particular situation, consult your own attorney.

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2 comments

Gary D. Bollinger

Gary D. Bollinger

Posted

That "yes", sounds a lot like "maybe."

Frederick William Schwinn

Frederick William Schwinn

Posted

This answer is simply wrong. Stick to what you know.

Posted

if your name is on the account they can try to use it to satisfy the judgment.

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1 comment

Frank Wei-Hong Chen

Frank Wei-Hong Chen

Posted

In addition, in some instances, the judgment can be amended to include the individual: http://www.avvo.com/legal-guides/ugc/amending-judgment-to-add-alter-ego-in-california?ref=result_2_title

Posted

The percentage of your ownership may factor into the amount that can be seized: you need to consult with your business lawvatty.

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2 comments

Frank Wei-Hong Chen

Frank Wei-Hong Chen

Posted

In California, the percentage ownership is completely irrelevant. The answer to this question is YES. Sent via BlackBerry from T-Mobile

Gary D. Bollinger

Gary D. Bollinger

Posted

The first answer appeared to consume the clarity of the simple "yes" with words vitiating it's impact. I stand corrected.

Posted

Actually, I have to respectfully disagree with with my colleagues who answered that they can go after your corporate bank account. I dedicate 90% of my practice to enforcement of judgments, and unless your corporation is named on the judgment, the answer is almost definitely "no, they cannot go after your corporate account for a judgment against you"

Corporations are separate legal entities and they can no more go after assets of your corporation for a judgment against you than they can go after assets of your brother or sister for a judgment against you.

If your SSN is linked to the account though, the bank may levy it if a levy comes in against you. You should make sure only the corporations FEIN is on the account and not your SSN. Even if they do levy it incorrectly, you can file a third party claim and most likely get the $ back so long as you haven't been commingling etc. Cross that bridge when/if you come to it.

If you have been commingling and ignoring corporate formalities, using corp $ to pay your own personal bills etc, they may be able to get your corp. on the hook for the judgment, but it would require alot of additional proceedings that I am not going to go into here.

Short answer is you are almost certainly fine but if you want to be extra careful make sure your SSN isn't on the accounts.

If you have a judgment against you you should definitely follow corporate rules to a T, as not to do so puts your corp in jeopardy.

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2 lawyers agree

1 comment

Gary D. Bollinger

Gary D. Bollinger

Posted

A very good answer. If my answer was a part of the, "colleague.. disagreement"' I am am happy to serve as the gateway to knowledge.

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