If the owners of a corporation don't file their annual paperwork, neglect to pay their annual fees, or commit fraud, a court could ignore the fact that a corporation has been established and the owners could be held personally liable for the actions of the corporation. This chain of events is referred to as ________.
A) vacating the corporate status
B) yielding the corporate privilege
C) surrendering the corporate shield
D) piercing the corporate veil
E) capitulating the corporate doctrine

Question

Quizplus · Accepted Answer

Piercing the corporate veil is the legal term for holding the owners of a corporation personally liable for the actions of the corporation when they have not properly maintained the separation between themselves and the corporation. This can happen when the owners fail to file the necessary paperwork or engage in fraudulent activities, causing the court to "pierce" the corporate veil and hold them accountable. The other answer choices do not accurately reflect this concept.

If the Owners of a Corporation Don't File Their Annual