What is the process for corporate liquidation?

Corporate liquidation is the process by which a business legally closes its operations and disposes of its assets. In Texas, the process for liquidation begins with the board of directors passing a resolution to dissolve the corporation. The resolution is then filed with the Secretary of State. The board of directors must turn over all of the corporation’s assets to a liquidator who, working with the board, will settle all debts and obligations. The liquidator will then distribute the remaining assets among the shareholders of the corporation in the form of cash or property. The liquidator must also perform a search to locate creditors who have not yet been paid. These creditors may be owed money for goods and services or may have provided money to the corporation by way of a loan. The liquidator must then make arrangements with the creditors to pay them. There are also tax obligations that must be met. The liquidator must submit all of the necessary tax forms to the Internal Revenue Service (IRS) in order to ensure that all taxes have been paid. Once all debts and obligations have been settled, the corporation’s attorney will file the necessary paperwork to terminate the corporation with the Secretary of State. The liquidation process is then complete. The corporation’s assets are then distributed to the shareholders and creditors, and the corporation ceases to exist as a legal entity.

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What is the process for corporate liquidation?

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