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When Are Shareholders Responsible for Company Debt ...

Mar 12, 2019 · Since a company is a separate legal entity, in most instances, it is separate from its shareholders. If a company sustains a debt, the company must repay it. However, in some instances a shareholder may be responsible to pay a company’s debt.…

When Can Shareholders Be Responsible For Company Debt ...

This capital can be used to pay off company debts, but it will normally not extend into any dividends paid or other capital the shareholder has. Circumstances where Shareholders can be responsible for company debt. Because of this, there are very few circumstances in which a shareholder will be held to be responsible for a companies debts.…

Are shareholders responsible for company debt? - Quora

Shareholders are not responsible for the debt of the company in which they own shares UNLESS a creditor is successful in persuading a court that the “corporate veil” should be pierced because the corporate format was merely a sham and an artifice used to deceive creditors.…

Shareholder Liability For Corporate Debt

A shareholder might become liable for that corporation's debt if they guarantee the debt. In other words, the shareholder might make a contractual agreement and hold personal liability to the company's creditor on that particular debt. Sometimes this liability might arise on accident,...…

Are You Personally Liable for Business Debts? Nolo

Generally, shareholders are not personally liable for the debts of the corporation. Creditors can only collect on their debts by going after the assets of the corporation. Shareholders will usually only be on the hook if they cosigned or personally guaranteed the corporation’s debts.…