BUSINESS BANKRUPTCY

Business Bankruptcy When your business is in trouble, determining how to proceed is critical. Getting experienced legal assistance should be your first step. Variables depend upon whether your business is a corporation, a partnership, or a proprietorship.

Corporations, limited liability companies and partnerships are legal entities separate from their shareholders or partners. They can file Chapter 7 or Chapter 11 bankruptcy in their own right. Partnerships and proprietorships require the individual owner to file Chapter 7, Chapter 11 or Chapter 13 (if the debt limits are met).

Questions to be considered include whether the business be reorganized or liquidated. To answer these questions, you have to know what has caused the problems the business now faces and what are the prospects for change: Reorganization can free up cash from servicing old debt to permit current operations; permit rejection of leases or contracts that are no longer advantageous; or prevent the loss of vital assets or cash to creditor collection actions. Liquidation is an end to operations that can see the dismantling of an organization completely.

Careful consideration of the choices in Chapter 7, Chapter 13 or Chapter 11 could provide a breathing space for the owners to sell the business as a going concern or or its assets in something other than a fire sale. The resulting proceeds could pay taxes or unpaid salaries; sale of the business could provide ongoing jobs for the work force under new ownership.

The choices available to business owners and corporations for Business Bankruptcy require the help of an experienced law team like the partners at Hagen and Hagen. Call us today to schedule a consultation.