Business Bankruptcy–When does a business file bankruptcy?
What happens when a business needs to file bankruptcy?
Contemplating filing a “Business bankruptcy” should strike fear in your heart if you’ve been running your own show, and are now wondering if the show might be over.
Why? Because you need to extra careful who you hire to help you decide how to treat the business in bankruptcy. You need to be advised by an attorney who will explain how your business will be treated by creditors and the court. Choose your attorney unwisely and you may still be liable for the debt post-discharge, you may lose your business to liquidation, you may be accused of intending to defraud creditors based on what you did with the business prior to filing.
What chapter do you file? Do you file personally? Does the business file alone? What happens to the assets of the corporation?
I’ve worked through this analysis with many clients’ businesses, and reached different conclusions and solutions depending on the facts of their situations. Business bankruptcies are often my favorite cases because I am able to shepherd my clients to freedom from their business debt (albatrosses around their necks).
Here are some of the questions that you and I will discuss: (these really are the tip of the iceberg–we’ll have much more to discuss)
- Is your business solvent? Will it ever be solvent?
- How was the business entity constructed?
- Do you intend to keep operating the business?
- Are you the personal guarantor for the business’ debt?
- Where are the assets of the business physically kept? Are they leveraged?
- Has the business paid off creditors recently?
- Has the business kept on the good side of the IRS and GDOR?
- What other assets have been pledged for the business debt?
- Are any of the business creditors ‘insiders’?
- How much is the business worth? How much accounts receivable are outstanding?
Have I piqued your concern? Are you looking at negative numbers on your balance sheet and worried about your personal finances sinking under the weight of your own albatross?
Call me, Attorney Shannon D. McDuffie to set up your consultation. (404) 418-8879.