Can a creditor pursue collections of a credit against an individual instead of the corporation? 6 Answers as of September 21, 2011

One reason to file a corporation is to have a liability shield. You don't have personal liability for corporate debts unless you are a guarantor. If you are sued you can interpose this as defense.

It would depend on whether you somehow became personally liable for the debts of the corporation.

It depends on whether you are a "partner" or a shareholder in a corporation that has been operated like a corporation, and what has been represented to the creditor. If you are a partner then you are legally liable for the debts of the business. If you are a shareholder and an employee of the corporation, even as an officer, and the corporation has been operated with board meetings, shareholders meetings, minutes and all the proper filings with the State, then you are not.

Business debt is debt of the business only, and not something that business creditors can normally pursue against the business owner personally. However, if you have "personally guaranteed" the debt, then they may be able to pursue a claim against you directly to recover on the debt. You would know if you personally guaranteed the debt if you agreed to this at the time the debt was acquired or if you agreed to this later on at some point. In addition to this, the business creditor may be able to pursue a claim against you personally if they show that you have engaged in some sort of bad faith dealing, abused the company and treated it as your alter ego, etc.

If you did not personally guarantee the debt, the creditor should not be able to sue you personally. The debt is from the corporation to the creditor and they cannot collect against you.