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BizAttorney
BizAttorney, Attorney
Category: Legal
Satisfied Customers: 2273
Experience:  Over 12 years of business and legal experience.
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When paying a Texas Franchise Tax.. I never set up a corporate

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When paying a Texas Franchise Tax.. I never set up a corporate bank account. This business had been in business for 10 years using just a dba and dba account. I registered the corporate identity but never took in a dollar from the company through anything but my original DBA bank account.
The company and I personally went bankrupt last year. They say the officer of the company is liable.
Since no money passed through a corporate bank account am I do refunads ffor all the years I have paid in and am I obligated to pay the balance owed
Submitted: 1 year ago.
Category: Legal
Expert:  BizAttorney replied 1 year ago.

BizAttorney : Good evening! I can help you out with your legal question tonight. First of all, if you declared bankruptcy both personally and through your company, then any debt owed by either would be discharged.
BizAttorney : However, if you maintained separation of the accounts then that should help with the corporate formalities.
BizAttorney : Even if the account is held in your dba name under your social, that could still be enough to keep the corporate veil from being pierced.
BizAttorney : Did you have additional questions?
Customer:

I am told under texas state laws that even if both file bankruptcy the officer is still 0bligated to pay any past Franchise tax.

Customer:

My question is not about bankruptcy

Customer:

It is that my bank account and company for 10 years were used through a DBA after 10 years I filed for a corporation but never made a corporate bank account

BizAttorney : That can be true. Is the franchise tax over three years old?
Customer:

so the next 10 years there was a corporate identity but I never incorporated the bank account

Customer:

Its like I had two identities

Customer:

All business was actually cindected as a DBA and went through a DBA account

Customer:

conducted *

Customer:

No Corporate account was ever made for the corporate Identity

BizAttorney : I understand. How old or how many years of franchise tax are owed?
Customer:

I am being audited for 3 years but paid for 7 additional years

Customer:

2008-2010

BizAttorney : Ok and did you file returns each of those years?
Customer:

thye amount is 17800 yet I talked briefly to a Tax attorney as a friend and he looked at my check stubs and bank records and saw DBA on all banking info

Customer:

yes

Customer:

This tax attorney says I can amend all returns and ask for refunds because I was paying incorrectly

BizAttorney : Yes those three years of tax are not dischargeable through bankruptcy, so your company owes it. You as an officer under tex law 171.255 for that tax. Yes you can always amend if the returns are incorrect. .
Customer:

Must you use your Ein number at the bank to be considered doing business as a corporation

Customer:

this account was only using my social and the bank even asked for the proper ein just before i closed it

BizAttorney : No, the account must simply be used for only business and not as a personal piggy bank.
Customer:

it was used for both

BizAttorney : An EIN number helps to separate the accounts, but it is a totality of the factors and not just one factor.
BizAttorney : Yes if it was mixed, that is problematic.
Customer:

should I fight this or pay it?

Customer:

accordingly to the attorney friend I was never protected under corporate vale

Customer:

so we havea corporate identy, and we have a dba account and checks, we have credit cards of company and personal being used back and fourth for personal and business expenditures

BizAttorney : That is probably not going to be enough to uphold the corporate veil.
BizAttorney : If your accounts were separate then you would be in better shape.
Customer:

his point of view is that I basically had two businesses and only did sales from the company with the DBa

BizAttorney : That is an argument, but the commingling of accounts usually pierces the veil.
Customer:

the accounts are closed

BizAttorney : If they were open then, they will be relevant.
Customer:

exactly and so if there is no corporate veil than is there a legal liability to pay franchise tax

Customer:

everything was closed last year but the oint of audit runs before the closing date

Customer:

point*

BizAttorney : The court will look at how you used the accounts and if it had mixed monies then your personal monies will be wanted by the tax collector.
BizAttorney : It doesn't look good for you.
Customer:

my personal moneies came from the business and was reported . I didnt use my personal accounts for accepting money

Customer:

only for pay company expenses

BizAttorney : Did you take money from the business account and pay them into another only personal account?
Customer:

I spent all I had trying to save that company

BizAttorney : I am sorry.
Customer:

I took 600k of my own moeny to pay the bills of the store

Customer:

thank you just trying to sort things out I had that company for 20 years

BizAttorney : I know it is hard. It is like another child.
Customer:

exactly It was my only child till just a few years ago

Customer:

to keep getting hammered over and over financially is the nightmare

Customer:

to lose my credit and so on ...

BizAttorney : Well refile and lower your tax liability, then negotiate a lower payoff amount. Don't fight it though because it is fairly likely that they can pierce the veil.
BizAttorney : Then it will be over.
Customer:

there is nothing to take and I made my money in the stock market but thank you

Customer:

I refiled as 0 because nothing went through a corporate account ever

BizAttorney : You are welcome and I wish you the best of luck!
BizAttorney : It sounds like it is almost all over.
BizAttorney : Please make sure to leave me feedback before you go, so that I can continue to help others.
BizAttorney, Attorney
Category: Legal
Satisfied Customers: 2273
Experience: Over 12 years of business and legal experience.
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