one hand pointing mean job demands or job pressure concept flat illustration Business about hard work and pressure for presentationCo-author: Tim Fandrey

A corporate client of the firm was recently sued for breach of contract and other violations. However, the company manager found himself facing a personal liability allegation for the company debts.  Why? The petition claimed that personal liability was warranted because the company failed to file a timely Texas franchise tax report.  This failure meant the company forfeited its corporate privileges from the day after the franchise tax report was due until the date when the report was filed and any associated tax liabilities were paid.  However, can this simple failure cause personal liability against the officers and directors for the debts of the corporation?

Most doctors loath dealing with financial reports and generally dealing with the business side of the practice of medicine.  Most just want to focus on helping their patients.  Failure to keep up with the “business” side of the practice of medicine can be devastating.  Here are my top mistakes.

  1. Support Staff – It is

A central purpose for creating a corporation or an LLC is for asset protection.  These companies shield owners from liabilities that accrue during the life of the business.

In Texas, failure to file your franchise tax returns or pay your franchise tax liability will cause you to lose your limited liability protection.

The Texas Tax