Stuart Business Bankruptcy Attorney
When many people think of bankruptcy, they often first think of individuals who file to discharge their consumer debt. Unfortunately, businesses also experience great financial difficulties when they take on more debt than they can afford to repay. If your business has unmanageable levels of debt, it is important to understand the legal options available to you that can help your business. The type of bankruptcy you file will have a huge impact on your business, and on your future. Below, our Stuart business bankruptcy attorney explains further.
Types of Business Bankruptcy
There are many different types of bankruptcy that can help your business. The most common of these are as follows:
- Chapter 11: Chapter 11 is the form of bankruptcy most commonly thought of for businesses. During a Chapter 11 bankruptcy, the business’ debts are formally reorganized into a repayment plan. There are no constraints on the timeline for the repayment plan, which can make it even more affordable for business owners. Additionally, business owners can continue to run their company during the process. Chapter 11 is an extremely complex and expensive process. It is important to speak to an attorney who can advise on your situation.
- Subchapter 5 under Chapter 11: Subchapter 5 is a relatively new type of bankruptcy process. It is not as administratively cumbersome as Chapter 11 and can expedite the restructuring and reorganizing process. Subchapter 5 is only available to businesses that have less than $7,500,000 of total debt.
- Chapter 13: Chapter 13 is typically reserved for individuals but in some cases, businesses may be able to benefit from this type of proceeding, as well. To qualify for Chapter 13, a business must have no more than $394,725 in unsecured debt and less than $1,184,200 in secured debt.
- Chapter 7: Chapter 7 is a liquidation bankruptcy, which means that if a business owner files, they will likely lose their company. Even when a business owner knows they cannot continue to operate their business, there are typically better ways to resolve the debt with creditors than filing Chapter 7.
What Type of Bankruptcy is Right for You?
With so many bankruptcy options, it is not always easy to determine which one is right for your business. The type of bankruptcy you should file will depend on a number of factors, including the type and size of the business, the amount of secured and unsecured debt your business is currently carrying, the assets associated with the business, tax obligations, the ownership structure, and more. A Stuart business bankruptcy attorney can review the facts of your case and help you determine which route is best for you.
Call Our Business Bankruptcy Attorney in Stuart for Legal Advice
If your business is struggling with high amounts of debts, you are already experiencing a great amount of stress. At Kelley Kaplan & Eller, our Stuart business bankruptcy attorney can relieve some of it by helping you navigate the process and making sure you receive the best possible outcome. Call us now at 561-264-6850 or contact us online to schedule a consultation.