Corporate Law Who is ultimately responsible?

[FlaRiptide]

A Foundation reported a total assets exceeding one million in 2006. This included sellable assets of over $850,000. The liabilities included loans to officers and others. No activity was recorded in 2007 or 2008 and no 990 was filed. The Chairman / CEO passed away in January 2008. The Foundation's "true" worth is presently zero, though no final 990 return has been completed.

If the other directors (friends and family of the CEO) do not comply with closing the Foundation who then would have the burden of doing so?

My concern is in regards to the $850,000 in assets which probably at some point was removed from the Foundation and filtered back to the C.E.O..

The executor of the C.E.O.'s probate (a relative) does not include this amount in the probate assets, and thus it has "disappeared".

I would think the IRS would be interested in this since assets were disposed of without recognition of revenue and filing of a return. Ultimately who would be the one the Finger would be pointed at? Would the probate executor be held legally responsible?

 

[dee_dub]

If the other directors (friends and family of the CEO) do not comply with closing the Foundation who then would have the burden of doing so?

Does anyone have to? Lots of entities just "peter out" - no-one files for a while, they are deemed no longer in good standing, and eventually are taken off the state corporate registry.

It is impossible to answer your question about the potential liability of the executor. At what point did the $850K become part of the CEO's estate? Should the executor have known of it? Was it disposed of while the CEO was still alive?

 

[FlaRiptide]

Lots of entities just "peter out" - no-one files for a while, they are deemed no longer in good standing, and eventually are taken off the state corporate registry.

This would be true if the Corporate Annual Report was not filed.

The most recent Corporation Annual Report was filed with the Sectretary of State in June of 2008, six months following the death of the C.E.O. and the C.E.O. was left as the Chairman. The business address listed on the Annual Report is not and was not valid at the time of filing. The business was "closed" and the lease expired. This was filed by the wife who is the Vice Chairman. It is the 990 tax returns which have not been filed since 2006.

Thank you...