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alter ego

Alter ego is a legal doctrine whereby the court finds that a corporation lacks a separate identity from an individual or corporate shareholder . The court applies this rule to ignore the corporate status of a group of stockholders, officers, and directors of a corporation with respect to their limited liability . Finding alter ego gives the court cause to pierce the corporate veil and hold individual shareholders personally liable for debts of the corporation. 

Earlier, the alter ego doctrine was not applicable to other business forms, such as limited liability companies (LLCs) . However, the alter ego doctrine is now applied to a limited liability company as well. 

[Last reviewed in December of 2024 by the Wex Definitions Team
]

Keywords

• llcs-corporations-partnerships

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