liquidation


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Liquidation

The collection of assets belonging to a debtor to be applied to the discharge of his or her outstanding debts.

A type of proceeding pursuant to federal Bankruptcy law by which certain property of a debtor is taken into custody by a trustee to be sold, the proceeds to be distributed to the debtor's creditors in satisfaction of their claims.

The settlement of the financial affairs of a business or individual through the sale of all assets and the distribution of the proceeds to creditors, heirs, or other parties with a legal claim.

The liquidation of a corporation is not the same as its dissolution (the termination of its existence as a legal entity). Depending upon statute, liquidation can precede or follow dissolution.

When a corporation undergoes liquidation, the money received by stockholders in lieu of their stock is usually treated as a sale or exchange of the stock resulting in its treatment as a capital gain or loss for Income Tax purposes.

See: aberemurder, assassination, cancellation, composition, discharge, dispatch, dissolution, homicide, killing, murder, payment, termination

liquidation

the procedure under which a company is dissolved (or wound up). Liquidation maybe voluntary (where the company is solvent but where the purposes for which it was set up have been achieved or no longer exist) or compulsory (usually where the company is insolvent). The function of a liquidator is to convert the assets of the company into cash, which is then distributed among the creditors to pay off (so far as possible) the debts of the company. Any surplus is then distributed among the members.

LIQUIDATION. A fixed and determinate valuation of things which before were uncertain.

References in periodicals archive ?
We look forward to working with the Liquidation World team as we continue to build on our vision of creating North America's premier closeout, liquidation business.
based homeowners insurer, was ordered into liquidation.
Further investigation of Subchapter K dissolves the facade of simplicity, as numerous parts of Subchapter K can come into play on a liquidation of a partner's interest.
WHETHER PLANNING FOR A LIQUIDATION of their own professional practices or advising clients about the liquidation of a commercial organization, CPAs will find that the problems and the solutions associated with each are likely to be the same.
as a capital transaction rather than as a dividend) if both (1) it is a redemption from a noncorporate shareholder, and (2) it is a redemption in partial liquidation of the distributing corporation.
Although the REO liquidation loss severity fell for most property types, the overall loss severity (including all resolution types) actually increased for multifamily (250 bps), office (170 bps) and hotel properties (1020 bps), while retail (980 bps), healthcare (3680 bps)and other (930 bps)property type loss severity fell in 2005.
Practice tip: The liquidation-reincorporation technique may be useful when the liquidating corporation has sufficient net operating losses (NOLs) to offset the gain recognized on its disposition of low-basis property in complete liquidation.
was placed in liquidation by the Illinois Department of Insurance, effective Jan.
The Corporation is operating under a plan of liquidation and dissolution that was approved by shareholders in October 2000.
The issue addressed here is that if the error is discovered after liquidation becomes final, the importer is prevented from making an adjustment to its cost basis used for computing federal income tax, even though it has voluntarily tendered the proper amount to Customs.
Under IRC section 302(b)(4), two requirements for partial liquidation treatment are
The board recommends that stockholders approve this transaction based upon its belief that accepting the offer from Vector and proceeding with the liquidation and dissolution of Tripos provides a greater certainty of value to our stockholders than the continued uncertainty of operating Tripos in its current form or under any other structure that we might reasonably put in place.