Eli5: why the shareholders in a company are not liable to pay debts owed by the company?
In: 181
The trade off for not being liable to pay the debts of a company is that you can’t use the assets of the company for personal gain. So The Walton family can’t just go to Walmart and start grabbing things off the shelf or take money out of the register. They can only extract company assets if they are paid a dividend that comes with tax implications and rules. The creation of corporations makes the company a completely separate legal entity then the owners.
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