Debt Responsibility

If your husband had a sole proprietor business and dies is his wife responsible for the debt after the business is dissolved?

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Wiki User
10/03/2008

This previous answer is incorrect. A sole proprietorship is an individually owned entity, it is legally the name or service of that said person. Therefore the company dies when the owner dies, you cannot not operate "Mary Smith Accounting CPA", if you are not Mary Smith. In order for the company to be passed on or rights transferred it would have to be a partnership, LLC, Joint venture, or a corporation. You as his wife would not be responsible, he has unlimited liability, no one could try to collect the debts of his company from you, but from his estate. -"yeah if its in his will that it goes to her then it will but if not the government will break the company up and sell it piece by piece

Subject to laws of your country - it will depend on how the business was structured. The debt may remain with the business and not the personal estate. In a non incorporated personal business it is generally with the estate any residual which may pass to the wife but not a debt of the wife. Always seek legal advice."