Eli5: why the shareholders in a company are not liable to pay debts owed by the company?
In: 181
Because the company is totally different animal than the people in it– it’s its own entity. We do this on purpose to encourage people to do business. If you were personally on the hook for a business risk, you’d take less risks, and the economy would suffer.
If they’re doing anything illegal to try to avoid personal liability, then we can “peirce the corporate veil” and hold them personally liable.
The current top answer doesn’t address your question and isn’t a simple answer either.
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