Piercing the Corporate Veil

Piercing the Corporate Veil means:
the process of imposing liability for corporate activity, in disregard of the corporate entity, on a person or entity other than the offending corporation itself. There are times when the court will ignore the corporate entity and strip the organizers and managers of the corporation of the limited liability that they usually enjoy. In doing so, the court is said to pierce the corporate veil. The S corporation provisions pierce the corporate veil and allow the income to be taxed to the shareholders. The collapsible corporation rules also pierce the corporate veil.