June 19, 2019

June 19, 2019

Subscribe to Latest Legal News and Analysis

June 18, 2019

Subscribe to Latest Legal News and Analysis

June 17, 2019

Subscribe to Latest Legal News and Analysis

Buying Assets Of A California Employer? You May Be Required To Withhold Seller's Unpaid California Employer Contributions

Yesterday, John Jenkins wrote in DealLawyers.com about successor liability in asset purchase transactions.  Many practitioners may be unfamiliar with potential successor liability under California's Unemployment Insurance Code.

Pursuant to Section 1731 of the California Unemployment Insurance Code, any person that acquires the organization, trade or business, or substantially all the assets of an employer is required to withhold in trust money or other property sufficient to cover the amount of any contributions, interest and penalties due or unpaid from seller until the seller produces a Certificate of Release of Buyer (Form DE 2220).  If the employer does not produce a Certificate of Release, the buyer must pay the amount or the value of the property so withheld to the Department at the time of the purchase.  For more information, see Requirements for Obtaining Certificate of Release of Buyer (DE 2220) When a Business Is Sold (DE 3409A)

© 2010-2019 Allen Matkins Leck Gamble Mallory & Natsis LLP

TRENDING LEGAL ANALYSIS


About this Author

Keith Paul Bishop, Corporate Transactions Lawyer, finance securities attorney, Allen Matkins Law Firm
Partner

Keith Paul Bishop is a partner in Allen Matkins' Corporate and Securities practice group, and works out of the Orange County office. He represents clients in a wide range of corporate transactions, including public and private securities offerings of debt and equity, mergers and acquisitions, proxy contests and tender offers, corporate governance matters and federal and state securities laws (including the Sarbanes-Oxley Act of 2002 and the Dodd-Frank Act), investment adviser, financial services regulation, and California administrative law. He regularly advises clients...

949-851-5428