Definition: is a temporary company or organization, which is formed and designed specifically to be liquidated before its profits and incomes become taxable. A collapsible corporation might either sell all of its shares or completely liquidate itself after it has made its desired short-term revenue. Typically, each collapsible corporation is organized with an existing, prearranged plan for its liquidation. One of the most prevalent collapsible corporation types is the one that serves to buy real estate.
In a Sentence:
It is common for small businesses to enter collapsible corporations to make some revenue fast and without being obliged to pay taxes.
Creating collapsible corporations is a common practice these days since such a business method helps the shareholders secure their personal assets in case of financial damage.
Most of the time, collapsible corporations are created to purchase property.
Synonyms and related words: thin corporation, company liquidation, taxable income, closed corporation, corporation de facto, short-term venture, capital gain