Bass, Berry & Sims attorney Steve Jasper provided insight for an article in State Tax Notes about a Tennessee court ruling holding a dissolved company’s shareholder liable for unpaid franchise and excise taxes. While the shareholder argued that the statute of limitations prevented the Department of Revenue (DOR) from collecting the unpaid taxes, the Tennessee Court of Appeals ultimately ruled that the statute of limitations did not apply because the DOR had previously obtained a ruling against the corporation requiring the payment of the taxes.
In commenting on the case, Steve said “the ruling shows the DOR can seek to collect taxes assessed against a company from the prior owner and the prior officer of the company ‘in scenarios where there wasn’t actually willful misconduct or bad actions.'”
The full article, “Tennessee Court: Shareholder Liable for Dissolved Company’s Unpaid Taxes,” was published by State Tax Notes on January 1, 2018, and is available online (subscription required).