Full question:
I have been asked to serve as Corporate Secretary/Treasurer for the company I work for. The company is privately owned with only one stockholder. I do not own nor will I ever own any of the stock. This company is experiencing financial hardships due to the current economic woes. The company has gotten behind on Form 941 payroll taxes and is currently under a payment plan with the IRS. The company is also currently in arrears with several other unsecured debts. What kind of financial liability and responsibility will I be exposing myself to if I accept the Officer position?
- Category: Corporations
- Date:
- State: Mississippi
Answer:
We cannot give legal advice. The following is not a substitute for the advice of a local attorney. But we hope the information will be useful. The first rule of corporations is that owners are generally not liable for the debts of the corporation. Since you are an employee and not an owner, your liability is even less. As long as you don’t personally guarantee any debts—meaning you don’t promise to pay them if the company cannot—you should be protected from financial liability. This protection holds true provided you have no knowledge of any failure to maintain corporate records or any intentional wrongdoing by the owner or others involved.
This content is for informational purposes only and is not legal advice. Legal statutes mentioned reflect the law at the time the content was written and may no longer be current. Always verify the latest version of the law before relying on it.