If your business has begun to struggle, that could obviously end up affecting your personal finances as well. If you end up having to file for bankruptcy, do you just combine your business and personal bankruptcies into one case? That may work for you, but sometimes this is actually not an option and your bankruptcy process could end up being a little more complex. This is why it can be wise to have a Bergen County bankruptcy lawyer on your side who is ready to help you navigate through this process and discharge any business debts you have.
When Can My Business Debts be Included in a Personal Bankruptcy?
In some cases, your business debts can be included in a personal bankruptcy. This can usually only occur when the business owner is a sole proprietor though. That means that one person has incorporated and runs the business all by themselves. There are no employees or shareholders to speak of.
What Happens to Business Debts if I Have Partners?
When you have partners in your company, the business can go through Chapter 7 bankruptcy, but your own assets would not be involved. The company would be liquidated along with its assets and any money generated would be used to pay down any debts. This can include debts to the IRS, the state’s department of revenue, employees who need to be paid, and other liabilities.
Alternatively, a business can just “die” without going through Chapter 7 bankruptcy. Its assets get liquidated and liabilities get paid off. The bankruptcy process can make things a bit easier though, since a bankruptcy trustee can pay off priority creditors and keep everything organized. Then the individual partners in the business can see what kinds of financial obligations they have remaining.
Would There Be Any Reason I Could Not Qualify to File for Bankruptcy?
There is one particular thing that sometimes keeps people from filing for Chapter 7 or Chapter 13 bankruptcy. There are actually debt limits for these types of bankruptcy filings, and a company can end up exceeding these limits. If your business debts have risen high enough, you may not be able to file for bankruptcy in this way.
This is when Chapter 11 bankruptcy comes in. This can complicate matters significantly. This can also be a long and expensive process. You will want an attorney who is an expert when it comes to filing this type of bankruptcy so that you can be sure that everything is done correctly.
Talk to Our Bankruptcy Attorneys Today
Whether you are dealing with a personal or small business bankruptcy, you need to make sure that everything is done correctly. Contact the Law Office of Boyd & Squitieri and schedule an appointment with our experienced attorneys. We can help you with the paperwork and make it easier to get back onto solid financial footing.