Non Profit Judgment Debtors
I am not an attorney, I am a Judgment Broker. This article is my opinion, from my California experiences. Laws vary in each state. If you ever need legal advice or a strategy to use, you should contact an attorney.
Judgment enforcement against a (judgment debtor) large non-profit company, gets done with the same tools as done with every other corporate business or entity.
This article is about enforcing judgments on (judgment debtor) small non-profit entities. What if your judgment debtor is a nonprofit organization, or an officer in a nonprofit company?
Whether a non-profit organization is small or large, the method of levying an employee's wages at the entity is the same. If an employee works for a non-profit company, their wages can usually be levied.
When the nonprofit employer doesn't answer a Sheriff's wage garnishment notification, one may sue the nonprofit employer for the amount that they should have withheld, when state laws permit.
Whether a nonprofit organization is a company entity registered with the Secretary Of State's office, or not; non-profit organizations are less likely to pay dividends or salaries. Can their assets be levied to satisfy a judgment?
Non-profit entities have no stock shares, and many small nonprofits don't pay the officers with regular incomes.
While you can pay the sheriff to levy a judgment debtor's office equipment, that can be a very expensive way to enforce a judgment. It might cost more than would be recovered at the Sheriff's auction sale.
It is often very difficult to garnish non-profit asset distributions or dues, to enforce a judgment, unless they were proven to be a fraudulent transfer. If this is the case, enforcing would only be difficult.
The term "nonprofit" means only that the structure of a company is not for profit, and there aren't any stock certificates or shares. In almost every other way, a nonprofit company is run like any other business.
Some nonprofits, as an example, Sesame Street, have a spin off (for profit) corporation, which is where your money is sent if one buys an Elmo toy.
Certain larger and more "profitable" nonprofit organizations pay competitive wages, and may offer matching with saving accounts funds. There could be lots of of money inside a non-profit company.
One-person non-profit organizations are often used as a personal tax shelter, and occasionally there is some kind of scam happening.
With tiny nonprofit companies, there might be a co-mingling of assets between the president of the non-profit company and a personal checking account, treating the company as a personal piggy bank.
Just like for-profit businesses, nonprofits must keep their organization minutes, have meetings, be registered with the Secretary Of State, keep separate business bank accounts, etc.
When they do not follow the requirements to be or stay a non-profit company, they may owe a lot of taxes, and lose their liability protection.
If the nonprofit dissolves, maybe the creditors will get paid something upon the dissolution.
Debtor exams and post-judgment document production requests, served on a non-profit entity and perhaps 3rd-parties, might uncover many clues to located assets, which may be used to satisfy a judgment.
About the Author
http://www.JudgmentBuy.com - where Judgments and debts quickly get recovered by the best - matched expertly for free, to your judgment debtor. Mark Shapiro, we pay for leads, and offer the best no obligation free leads for enforcers, collection agencies, and contingency collection lawyers.
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