That changes when you’re shutting down or selling at a price that won’t make everyone happy. In a growing company, fiduciary duties are usually (and rightly) far down the list of concerns for the officers and directors. Directors and officers of a company owe them to the company and, in certain circumstances, its shareholders or creditors. You’ve probably heard of fiduciary duties. Notice Conflicts of Interest and Deal with them Paying your employees their final paychecks (and paying the government the related taxes) will avoid these liabilities. In some circumstances, corporate principals can be liable for failure to pay employees. Another exception is employee claims for wages, severance, sick pay, vacation pay, and holiday pay. The government will pursue this liability aggressively. You must pay the payroll taxes and you must pay any amounts withheld from employees’ wages. The responsible officers of a company are personally liable for these. The major exception is payroll and withholding taxes. There are some exceptions, and it is crucial to be aware of them. Fortunately, officers and directors of a failing company usually are not liable for the company’s debts.
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