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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.

West's Encyclopedia of American Law, edition 2. Copyright 2008 The Gale Group, Inc. All rights reserved.


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.
Collins Dictionary of Law © W.J. Stewart, 2006

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

A Law Dictionary, Adapted to the Constitution and Laws of the United States. By John Bouvier. Published 1856.
References in periodicals archive ?
Dated this 5th day of February 2015 Jim Luby Liquidator Note: This is a Members Voluntary Liquidation. All admitted creditors have been or will be paid in full.
Westmeath Note: This is a Members Voluntary Liquidation and all admitted debts have been paid or will be paid in full.
IN THE MATTER OF THE COMPANIES ACTS 1963 TO 2013 And IN THE MATTER OF KIRWAN ELECTRICAL CONTROLS LIMITED (In Voluntary Liquidation) At an Extraordinary General Meeting of the above mentioned company duly convened and held at McCullagh Higgins & Co., Solicitors, Dungarvan, Co Waterford on the 20th August 2014 the following Resolution was passed as a Special Resolution: "That the Company be wound up voluntarily as a members Voluntary Liquidation, and that Peter McCormack of P.A.

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