Can I File Bankruptcy and Keep My Business
Written by Robert DeMarco
When it comes to business, there are many things to think about. However, what if you hit a rough patch and can’t pay your bills? Can you file for bankruptcy and keep your business? The answer is yes. But there are some things you need to know first. This blog post will discuss how bankruptcy can help businesses stay afloat and the steps you need to take to make sure it goes as smoothly as possible. So read on to learn more.!
What Are Business Bankruptcies?
Business bankruptcies are, as the name implies, a way to keep your business afloat when you can’t pay your bills. Businesses fail all the time, and most of the time, it’s due to a string of bad luck or an economic downturn, in which bankruptcy is often a good idea. But sometimes, it’s a simple lack of business acumen. If you find your business in a similar situation and don’t know how to get out of it, a Business Bankruptcy Lawyer can help.
Can I File Business Bankruptcy Without Closing My Business?
Business bankruptcy has been around for years as a way to stop creditors from seizing your assets and putting you out of business. The idea behind a business bankruptcy is to reorganize the company’s debts to be paid back over time. This gives the company some breathing room and allows it to stay in business. In most cases, a Business Bankruptcy will allow you to keep your company open and running. However, there are a few factors to consider before filing for business bankruptcy.
If The Company Still Making Money:
When you start a business, one of your main goals is to make money. If the company isn’t profitable today and has been losing money for some time now, perhaps closing up shop might be an option that best suits what’s going on in your life right now? This doesn’t mean giving up without fighting back. We know how difficult things can get when entrepreneurs face hard times like economic downturns or other temporary factors affecting their businesses’ stability (e..g., pandemic). To prevent this from happening too quickly before looking at other alternatives such as staying open while weathering those storms instead, consider keeping realistic expectations about continuing operations if they’re currently not generating any revenue but still require maintenance and employee salaries.
If The Assets Of The Company Are Worth More Than The Liabilities:
If your business still has more assets than liabilities and you are making money, it might be worth saving. If a business is severely upside down, cutting losses and saving money will likely be the best course of action. However, if you’re able to turn things around, it may not hurt to consider taking on some additional funds for creditors as well! Closely examining what could go wrong with bankruptcy is a good idea before deciding how to reorganize debt to keep the company afloat financially. From paying off all remaining balances outside of court proceedings (unless this would help clear up any confusion) or even shut down temporarily so that liquidation occurs when necessary. Both options have their pros & cons, which should seriously be considered before auctioning one’s preference depending on where they stand today and their overall position and situation.
If You Are Personally Responsible For Your Company’s Debts:
The easiest way to avoid being personally liable for your company’s debts is by keeping it running (without taking on any more debt) while you negotiate with creditors. Closing down can leave them no other option but to mess up everything, including going after personal assets if there aren’t enough pieces left over after shutting down operations. Another approach would involve filing an individual Chapter 7 bankruptcy and wiping out all guarantees; this may seem like a last resort, but things get worse before they get better.
Who Can File Business Bankruptcy?
In general, anyone who owns a business can file for business bankruptcy. Anyone filing for business bankruptcy should have a Business Attorney who has experience with this type of bankruptcy. And to be sure, you should speak with a business attorney before moving forward with your case.
How Does Business Bankruptcy Work?
When you file for business bankruptcy, your bankruptcy attorney will work with you to create an action plan. This plan will include a list of your company’s assets and debts. It will also state how much money you can afford to pay back each month. This plan is called a reorganization plan, and it’s a crucial part of Business Bankruptcy because it states what you will pay back to your creditors. And Business Attorneys use this plan to renegotiate your debts with your creditors.
How Does Business Bankruptcy Affect My Business?
As stated above, Business Bankruptcies are designed for businesses that need some time to get back on their feet. It will allow you to keep your company open and running in most cases. You will still be responsible for paying your debts, but you will have more time to do so. And by renegotiating your debts with your creditors, you may be able to pay them back at a lower interest rate or work out a payment plan that’s more beneficial to you and your company. Business Bankruptcy is not designed to forgive your debts – it will simply allow you to pay them back at a slower pace so that you don’t go out of business.
What Are the Requirements for Business Bankruptcy?
As mentioned above, Business Bankruptcy isn’t complete forgiveness of your debts. Business bankruptcy is designed to streamline the process of repaying them and allow you to stay in business. To qualify for Business Bankruptcy, Business Attorneys will look at several factors, including:
– The amount of money you make or lose each month.
– How much money do you owe in total.
– The number of assets you have.
– Your credit score.
– Whether or not you have filed for Business Bankruptcy before.
These are just a few of the factors that business attorneys look at when determining whether or not business bankruptcy is the right option for you and your business. Business attorneys will also take your business bankruptcy plan into account. It is not designed to forgive your debts – it will simply allow you to pay them back at a slower pace so that you don’t go out of business.
Why Do Companies File Chapter 7 Bankruptcy So Rarely?
Filing for bankruptcy is usually seen as the ultimate way to close down a business because it allows you to dissolve your legal entity and sell off any assets. However, this isn’t always an option when there are still debts owed by individuals who operate within separate corporate structures like corporations or limited liability companies (LLC). In these cases involving separate entities with differing creditworthiness ratings from creditors to secure loans, filing Chapter 7 will result in foreclosure on all unpaid balances before anything else happens. Here are a few other issues that may arise:
- In most cases, you can close down your business without a bankruptcy attorney. You save money and time by not going through filing for bankruptcy.
- If you put your partnership into bankruptcy, the partners’ assets are at risk.
- Filing for bankruptcy lets people ask you to pay back their money. If you file bankruptcy, they can ask the judge to make you pay them back. The court will decide if these people can make you pay back your money and what kind of penalty they want to charge you for this.
- When a company goes bankrupt, the owner can get a better asset price than the bankruptcy trustee.
The company should consider whether the risks outweigh the benefits of closing it through bankruptcy. The primary use is that we will liquidate all of our assets and start fresh.
Chapter 7 Bankruptcy and the Sole Proprietor
Chapter 7 bankruptcy is not usually suitable for business owners. But sometimes, it might help if you are a sole proprietor who provides something. For example, you are an accountant, freelance writer, or fitness trainer. Chapter 7 bankruptcy can be helpful because the trustee cannot sell your ability to do that work. This is how it works:
The sole proprietor is responsible for both personal and business debts. When you file the Chapter 7 bankruptcy, your entire debt will be included in this list of creditors – wiping out any owed money or property by eliminating them from future payments altogether! This makes it an attractive option if one has little to no other valuable possessions because only their name would remain on record after filing, giving everyone else hope about getting paid back at some point. You can also use exemptions when protecting relatively minor assets associated with running a small-scale enterprise.
In case you have more business debt than consumer debts, filing bankruptcy will allow for an easy way out. A Chapter 7 discharge will enable one to get rid of all their financial worries without affecting property or credit scores- it’s perfect if there are too many bills that can’t be paid!.
Chapter 11 Bankruptcy and the Sole Proprietor
The complexity and expense of Chapter 11 bankruptcy make it prohibitively expensive for most small businesses. Partnerships or corporations can be a good idea because people don’t have to worry about the day-to-day operations of a company. They can still pay off debts and earn interest on their investments even if there is a problem with the business. A sole proprietor may also choose this path if he/she wants complete control over his company but doesn’t have time on his hands; however – like any form involving repayment plans. It requires approval from creditors before the beginning, so you’ll want an attorney helping out along the way!
Chapter 13 Bankruptcy and the Sole Proprietor
If you are a sole proprietor, filing Chapter 13 might be your best option. Not only can personal and business debts go into the same bankruptcy package. But it will also allow for payment plans that combine both types of debt to fit with what’s available in terms of money flow. If there is any leftover after everything else has been paid off, these extra funds could help avoid foreclosure on the property or even conserve one’s livelihood!
Suppose you’re in a situation where your sole proprietorship requires the storage of goods, products, or equipment that are worth more than what is exempt from bankruptcy protection (an exemption can’t protect most nonexempt assets). In that case, Chapter 13 bankruptcy might not work out. You would need to find another solution and gather all required information about this before making any decisions to ensure a maximum chance at success regarding how the company will operate post-bankruptcy.
Business Bankruptcy Lawyer
In case you’re in a situation where your business and personal finances are intertwined, it’s worth speaking with an experienced bankruptcy lawyer. DeMarco Mitchell, PLLC’s expert team of bankruptcy attorneys in Plano, Texas, is here to help guide you through the complicated process of filing for Chapter 7 or 13 bankruptcy while preserving as much property value as possible. We understand that no one wants to go bankrupt, but if you need to, we can make sure everything goes smoothly and protects what’s important to you. Contact us today at (972) 578-1400 or visit our website.
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