PA business debt

is credit card debt associated with a business transferred to the spouse if there are no assets in the business and the owner had no estate.the business was insolvent. is the debt anyones responsibility in the state of pennsylvania

Asked on June 11, 2009 under Business Law, Pennsylvania

Answers:

J.M.A., Member in Good Standing of the Connecticut Bar / FreeAdvice Contributing Attorney

Answered 11 years ago | Contributor

A business has separate legal capacity and exists independantly.  If a business has a debt and the business has no assets, then the business should be dissolved and the creditors notified.  Thus, the debt is not anyone but its owen responsibility.  I prsume that the business was an limited liability company or a corporation.  If the business was a sole proprietorship, then the person liable would be your spouse and the only money that would go to satisfy the debts are the assets in his estate.

MD, Member, California Bar / FreeAdvice Contributing Attorney

Answered 11 years ago | Contributor

This is not something that could simply be answered herein.  You see, it depends on the type of business (partnership, sole proprietorship, corporation, s-corporation, llc, llp, etc.).  Did the company have pass through taxation to the owner? Was there a commingling of the assets and liabilities and monies of the corporation to personal accounts?

This will then be a factor to determine if the spouse was involved, should be involved/liable or if only the estate. etc.


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