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Source Piercing the Corporate Veil Official Sources Matched to this deck.

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A two-shareholder close corporation has informal management practices but maintains separate bank accounts, pays its own bills, is reasonably capitalized, and does not divert assets to shareholders. A creditor argues that the close-corporation label alone justifies personal shareholder liability.
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Close-corporation status automatically prevents veil piercing. Close-corporation status automatically requires veil piercing. Close-corporation status may explain informal operations, but the court still asks whether the alter-ego elements are met. A close corporation can be pierced only if it has exactly two shareholders.

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