Definitions (3)

1.Finance: A claim against the assets, or legal obligations of a person or organization, arising out of past or current transactions or actions. Liabilities require mandatory transfer of assets, or provision of services, at specified dates or in determinable future.
2.Accounting: Accounts and wages payable, accrued rent and taxes, trade debt, and short and long-term loans. Owners' equity is also termed a liability because it is an obligation of the company to its owners. Liabilities are entered on the right-hand of the page in a double-entry bookkeeping system.
3.Law: (1) Responsibility for the consequences of one's acts or omissions, enforceable by civil remedy (damages) or criminal punishment. (2) An obligation to do or refrain from doing something.

Use liability in a sentence

  • Winners of the contest have a liability to report and pay any taxes associated with the cash and material prizes awarded from the company.

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  • The liability was too much for us to pursue that business plan because we did not want to expose our self to that much risk.

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  • Florida financial and responsibility liability laws state that you as a home owner have liability rights regarding the liability of contracted workers getting injured while working at your home.

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