If you’ve become overwhelmed with the debt you’ve incurred due to your business, you may be looking for options to relieve some of your stress and save your finances and business. The Wake Forest bankruptcy attorneys of Bradford Law Offices may be able to help.
Operating a business isn’t easy. Expenses can fluctuate and debt can pile up quickly. One of the cornerstones of the American economy is the success of large and small businesses alike. You don’t have to live in financial distress while trying to keep your business afloat. Fortunately, there are options for business owners to get assistance with resolving their debts by filing for bankruptcy.
The Wake Forest bankruptcy attorneys at Bradford Law Offices have over 25 years of experience helping business owners like you get out from under their mounting debt by filing for bankruptcy. We can help you decide which bankruptcy option will be right for you and your business, and help you get through the bankruptcy process by providing you with top-notch legal representation. Call us today at (919) 758-8879 to schedule a free consultation or reach us online and one of our representatives will contact you as soon as possible.
Bankruptcy Options for Businesses
Your bankruptcy options vary based on whether your business is a sole proprietorship or an LLC, partnership, or corporation. The type of bankruptcy you file will also depend on the type of business you own and your goal for the future of your business – whether you want to continue operating or whether you want to close your business.
If your business is a sole proprietorship, you can file a Chapter 7 bankruptcy personally. Since there is no difference between you and your business, by filing a Chapter 7 bankruptcy, you may be able to keep your business if you claim it as an asset. If your business is an LLC, partnership, or corporation, you are a separate entity from your business. In those circumstances, you must file bankruptcy for your business: in essence, your business files for bankruptcy.
There are three different bankruptcy options for business owners and their businesses.
Chapter 7 Bankruptcy
For sole proprietors, you have the option of filing for Chapter 7 bankruptcy either for yourself or for your business. If a sole proprietor files for Chapter 7 bankruptcy for their business, the business’ debts will be resolved but the business will be liquidated, meaning the business will be closed. When a sole proprietor files for bankruptcy personally, however, both their personal and business debts are combined as qualifying debt and are discharged.
North Carolina allows sole proprietors to keep some property by using bankruptcy exemptions. Anything outside of the property that can be exempted will be sold, including, possibly, the business as a whole. If the sole proprietor provides a service that doesn’t require significant supplies and equipment, then they may still be able to operate their business.
Chapter 7 bankruptcy isn’t the best option for LLCs, partnerships, or corporations because if one of these types of businesses files for Chapter 7 bankruptcy, the business’ debts aren’t discharged, which negates the entire purpose of seeking financial relief through bankruptcy. Instead, because a business that is one of these types is a separate legal entity, the property of the business would be liquidated.
Chapter 11 Bankruptcy
Filing for Chapter 11 bankruptcy may be an attractive option if you are hoping to maintain your business. Your business would file for Chapter 11 bankruptcy as its own entity. Known as the reorganization option, Chapter 11 allows your business’ debts to be resolved with a repayment plan. So long as you abide by the repayment plan, you can continue operating your business, and your debts will be resolved after you complete your required payments to your creditors.
The repayment plan will have to be agreed to by your creditors. You will also be required to provide continuous reports to the court detailing the financial status of your business.
Partnerships, LLCs, and corporations generally file for Chapter 11 bankruptcy (although sole proprietors can file this type of bankruptcy as well). This bankruptcy option is the more expensive option, however, which is why it’s more common for larger businesses to file for Chapter 11 bankruptcy.
Chapter 12 Bankruptcy
Chapter 12 bankruptcy is tailored specifically to farmers and fisheries. It allows farmers and fishers to continue operating their businesses while working to pay down their debts. Our attorneys have vast experience helping hard-working people who are struggling with debt and can work with you to file all the necessary paperwork correctly.
Chapter 13 Bankruptcy
If your goal is to resolve your debt while continuing to operate your business, this may be a good option for you. Chapter 13 bankruptcy is for individuals, so this option is only available to sole proprietors and other small business owners in their personal capacities. The major advantage of filing for Chapter 13 bankruptcy is that you are able to keep all of your business’ assets so that you can keep running your business. In the meantime, you have a repayment plan to pay off your debts to your creditors. The court will either require a bankruptcy trustee to be appointed to lead your business operations and maintain payments or allow you to continue running your business yourself.
Repayment plans for Chapter 13 bankruptcies last three to five years. At the end of the repayment plan, your bankruptcy is discharged and your business’ debts are resolved.
Tax Debt Resolution
Being burdened with tax debt can have significant implications on the way a person is able to operate their business. Our tax debt resolution attorneys know ways to mitigate the pressure you may be feeling from the IRS and can help you through the process of seeking relief. In some cases, it is possible to get debts discharged. In others, the debt can be alleviated through bankruptcy or other strategies.
Why You Need a Bradford Law Offices Business Attorney to Help You
Founded in 1996, Bradford Law Offices focuses on helping the people of North Carolina find resolutions for their bankruptcy and construction legal matters. Attorney Bradford has helped thousands of clients revive and maintain their businesses through bankruptcy and rise above the debilitating weight of debt and financial stress. It is Attorney Bradford’s sincere pleasure to help his clients come out on top after suffering to try to keep their businesses and personal finances afloat. Bradford Law Offices looks forward to doing the same for you.
Contact Us Today
If you’re struggling to maintain and pay your business’ debts, you may be able to resolve these financial issues by filing for business bankruptcy.
Business bankruptcy is a complex process. You need the business bankruptcy attorneys at Bradford Law Offices to help you navigate the process and help you protect your financial future. Call us today at (919) 758-8879 or contact us online for help getting your life – and business – back on track. Your initial consultation is free.