I closed my company 1-1/2 years ago; had no more work, and no more income, and let it die a "natural death" However, I am still cleaning up debt. If I file paperwork to Dissolve the corporation what impact will it have on those trying to collect from me or my closed business?
If you had a corporation and you are dealing with corporate debt, your creditors should not be collecting from you personally unless you signed something, like a guaranty, in your personal capacity or did not maintain the corporate separateness of the corporation and your personal affairs. Administratively dissolving the corporation will not thwart creditors in bringing claims against the corporation. Nevertheless, if the entity does not have any assets, it may very well be judgment proof.
Mr. Thomas is licensed to practice law in Massachusetts. This response is not legal advice and does not create an attorney/client relationship. This response is in the form of legal education and is intended to provide general information about the matter within the question. Often, the question does not include significant and important facts and timelines that, if known, could significantly change the reply. Mr. Thomas strongly advises the questioner to confer with an attorney to make sure he or she gets all relevant information to make informed decisions about the subject matter.
4 lawyers agree
The previous answer is right on the money. However, with most small businesses, creditors usually require a personal guaranty from the owner--especially business credit cards, bank loans, business vehicle financing, and commercial office space, etc. If you did business with other businesses--like suppliers, promo materials, marketing etc.--chances are there was no personal guarantee. However you could have signed something that did make you personally responsible for the debt. If you did not, then the entity and any assets could be used to satisfy the debts. If you are personally responsible though you can often negotiate these types of debts down to a more manageable level. An attorney can help you with that process.
This response is not to be considered legal advice by anyone. This communication, alone, does not create an attorney-client privilege. Unless you have executed a fee agreement with the attorney, that is related to the subject matter contained in this communication, you are advised not to rely on this communication to make any decisions whatsoever or to create an attorney-client relationship. No attorney-client relationship shall exist with this attorney without a fee agreement executed by you and the attorney.
5 lawyers agree
The answers provided above were good. Aside from waiting until claims are time-barred, a business bankruptcy would be the only other way to wipe out all debts for good. The business bankruptcy would not have any effect on personal obligations other than to force those getting discharged to go down that road.
The content of this message does not constitute legal advice and is not intended to be relied upon by anyone. It is highly recommended that the reader seek the opinion of a qualified attorney in his or her area for consultation and assistance. There are applicable statute of limitations and other considerations that only a qualified attorney can provide guidance on after being fully informed as to all of the circumstance of your particular case.
1 lawyer agrees