Corporate Dissolution

Often when a corporation ends business its principals simply stop filing annual reports with the Division of Corporations and allow the corporation to be administratively dissolved.  One important consideration often overlooked is the continuing liability under an administratively dissolved corporation.  While administratively dissolved, shareholders, officers, and directors may bear personal liability for acts they take on behalf of the corporation while they know the corporation to be administratively dissolved (F.S. 607.1421).  When formally dissolved, however, shareholders are generally not liable for claims, and in any event are not liable for any amount exceeding what is distributed in the dissolution (F. S. 607.1406-1407).  Where a company is insolvent and makes no distributions to shareholders upon dissolution, there would generally be no liability.  A Florida business law attorney can assist with the dissolution process.

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