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WHAT A BUSINESS NEEDS TO KNOW BEFORE THEY FILE FOR BANKRUPTCY

If you own a small business then you understand that the flow of business can be volatile. You can face long periods with reduced or nearly no profits. A lot of small businesses cannot manage the monthly business debt during these low profit periods. Maybe the business can maintain as normal through one or two hard times but too many hits can make it unmanageable for the business to keep up with all the payments to credit cards, signature loans, etc.

At that time the business owner may want to consider whether or not filing a personal bankruptcy would be beneficial for the business as well as the owner.

If you own a business and think that you may need to file a bankruptcy, here are a few things to consider.

• Any business debt that you signed for personally can be included in a Chapter 7 or Chapter 13 personal bankruptcy.
• Filing a bankruptcy on business debt that you personally signed for will erase your liability. However, if the business wanted to keep operating and restructure it’s business debt, then the business may need to file it’s own bankruptcy.
• For most small businesses, filing a personal bankruptcy will relieve enough financial pressure for you to continue operating the business.

If you would like more information about filing a personal bankruptcy when you own a small business, please contact Robert Eder Jr., Attorney’s office.