liquidate

play
verb liq·ui·date \ ˈli-kwə-ˌdāt \
Updated on: 26 Jul 2017

Definition of liquidate

liquidated; liquidating
transitive verb
1 a (1) :to determine by agreement or by litigation the precise amount of (indebtedness, damages, or accounts)
(2) :to determine the liabilities (see liability 2) and apportion assets toward discharging the indebtedness of
b :to settle (a debt) by payment or other settlement
  • liquidate a loan
2 archaic :to make clear
3 :to do away with especially by killing
  • was hired to liquidate a certain businessman
4 :to convert (assets) into cash
  • liquidated his securities
intransitive verb
1 :to liquidate debts, damages, or accounts
2 :to determine liabilities (see liability 2) and apportion assets toward discharging indebtedness

liquidation

play \ˌli-kwə-ˈdā-shən\ noun

Examples of liquidate in a Sentence

  1. The owners were ordered to liquidate the company and pay their creditors.

  2. The company is liquidating its assets.

  3. The owners were ordered to liquidate.

  4. The film is about a professional killer who's hired to liquidate a powerful businessman.

Recent Examples of liquidate from the Web

These example sentences are selected automatically from various online news sources to reflect current usage of the word 'liquidate.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.

Origin and Etymology of liquidate

Late Latin liquidatus, past participle of liquidare to melt, from Latin liquidus


Financial Definition of LIQUIDATE

liquidate

What It Is

In the financial world, to liquidate something means to sell it for cash. Although this sounds harmless, in the corporate world the term often carries a connotation of failure, because it is most often used in discussions about Chapter 7 -- a section of U.S. bankruptcy law under which companies and individuals liquidate their assets in order to repay their debts.

How It Works

Individuals, partnerships or corporations can liquidate assets. In the case of bankruptcy, when and how a borrower liquidates assets is a big deal. If all the debtor's assets are tax-exempt or subject to liens, there may not be any assets to liquidate and hence no money to distribute to creditors. If there are assets to liquidate, however, the creditors usually file a written claim so they can receive some of the proceeds. The trustee handles the liquidation and determines which creditors are paid first.

Why It Matters

The last step in the effort to repay debt in bankruptcy is usually to liquidate everything. However, the steps preceding liquidation usually involve bankruptcy, which -- at the individual level -- virtually ruins a person's credit for several years, making it very difficult and expensive to borrow money.

For businesses, liquidation usually means closing for good and selling off the assets. In the end, if a company's stock or bonds are deemed worthless by the bankruptcy court, investors might be able to deduct their losses on their tax returns.


LIQUIDATE Defined for English Language Learners

liquidate

play
verb

Definition of liquidate for English Language Learners

  • business : to sell (a business, property, etc.) especially to pay off debt

  • : to pay all the money owed for (a debt)

  • : to destroy (something) or kill (someone)


Law Dictionary

liquidate

play
verb liq·ui·date \ ˈli-kwə-ˌdāt \

legal Definition of liquidate

liquidated; liquidating
transitive verb
1 :to determine by agreement or litigation the precise amount of; also :to settle (a debt) by payment or other adjustment
2 a :to determine the liabilities and apportion the assets of especially in bankruptcy or dissolution
  • liquidate a corporation
— compare bankruptcy
b :to convert (as assets) into cash
  • liquidate an estate
intransitive verb
:to liquidate something (as a corporation)

liquidation

play \ˌli-kwə-ˈdā-shən\ noun


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