Although we all know that dealing with money and numbers are supposed to be a logical, black and white process, sans emotion, few of us can act that way-whether we have lots of cash, or a dwindling supply. Financial success can lead us to feeling euphoric, while financial woes send us into deep despair. Sometimes our emotions are also what cause us to use poor judgment when spending, investing, or making business decisions.
If you are a business owner and in financial distress, you may be feeling a whole lot of different emotions right now-despite the need for a cool head, the ability to make logical decisions, and a thick skin for dealing with criticism, challenges, and more. If you are worried that you may have to file bankruptcy, whether in Chapter 7, Chapter 11, or Chapter 13, there may be an immense sense of failure, and even shame. This can be compounded if you have business debts that are out of control too.
Chapter 11 is usually the best choice for any partnership or corporation filing bankruptcy; however, if you own a sole proprietorship, you can see those debts discharged in either your Chapter 7 or Chapter 13 filing-and in fact, the only way to see those debts eliminated eventually is in a personal bankruptcy. No matter the bankruptcy chapter, the benefit is that business debt can be discharged or reorganized while you (if so desired) continue to keep your doors open and conduct business.
If you are eligible for Chapter 7 due to a lower level of income and are sole proprietor, many business debts can be discharged in that three- to six-month process as they are considered personal. There is the chance though that if you own personal and business property, it could be sold by the trustee to pay off creditors-as well as business equipment and supplies. If you are worried about that, speak with your bankruptcy attorney about filing for Chapter 13 instead. Although the process is much longer (three to five years) and it is a repayment plan, you should be able retain personal and business properties. In Chapter 13, you are also relieved of personal liability for business debts.
In some cases, business bankruptcies can be tricky-and no matter what, you will need to work with an experienced bankruptcy law firm like Levitt & Slafkes, P.C. We have already helped thousands of clients through the bankruptcy process, and we understand exactly what you are going through. Call us at 973-323-2953, or contact us online to schedule a free consultation.
We are proudly designated as a debt relief agency by an act of Congress.