Many business owners think that simply filing Articles of Incorporation / Organization gives them all the protections of a corporate entity, but that's not the case.
In general, Corporations and LLC's protect the owners' personal assets if they follow several rules. This is called the "corporate veil". Failing to satisfy certain requirements will allow 'piercing of the corporate veil'.
1) If a corporation or LLC fails to file annual minutes with the North Carolina Secretary of State, the company will be administratively dissolved by the Secretary of State. These minutes need to be filed with the secretary's fees by April 15 of each year. Go to http://www.secretary.state.nc.us/corporations/ to determine if your company has maintained its minutes.
2) Corporations need to hold Annual Meetings of its shareholders and its directors, which needs to be in compliance with the by-laws of the corporation.
3) A company needs to be adequately capitalized to maintain its protection. This includes keeping the company properly funded AND properly insured.
Check with your company attorney or contact us to make sure you are in compliance in order to keep your company active and adequately protecting your personal liability.
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