Are You a Small Business Owner Who Needs Bankruptcy Protection?

Posted by admin on September 2, 2010

Filing for bankruptcy as a small business owner can have its advantages, but it can also be complicated. If you have questions about bankruptcy, contact one of our experienced bankruptcy lawyers.

The entrepreneurial spirit is one of the great things that makes America such a great country. The willingness of individuals to step out and risk their financial stability for the sake of a business they believe in has made America what it is. However, a recent study by a major university shows that one in seven personal bankruptcies are directly related with the failure of a small business. While corporations or partnerships cannot file for bankruptcy, Chapter 7 and Chapter 13 are often used by entrepreneurs who are trying to deal with personal and business debt.

Small businesses that are unincorporated don’t have the same restrictions as larger corporations. So when a small business owner gets in over their head, the business doesn’t file for bankruptcy, rather the individual files. For small business owners who file for Chapter 7 bankruptcy there are several protections which make it an attractive choice. As a sole proprietor, you operate your business by yourself so your business debts are also your personal debts, and as such they can be dismissed in a bankruptcy case.

There are several benefits for small business owners to file for bankruptcy.

There is uniform protection in the United States on future assets, which offers a fresh start to the debtor. If you are a business owner who files for bankruptcy, you can start a new business or a new job without worrying about having future earnings seized to pay pre-bankruptcy debt.
Another important benefit for small business owners filing for Chapter 7 bankruptcy is exemptions. Exemptions vary from state to state and there are sometimes conditions set which debtors must surrender property. States with higher exemptions are more attractive to debtors because it protects more of their property. If you are the owner of a small business you must list all assets both business and personal, which makes the exemption value of the state an important detail to know before filing. It can make the difference between keeping a home and having it liquidated. That’s why it’s important to have an attorney to guide you. These are waters that you must not try to navigate alone.

If you are a small business owner who is seriously considering bankruptcy the place to start is to fill out the form below. When you click submit, you will be contacted by an attorney in your state who will be familiar with all the laws and get you the protection that you need. The process is complicated if you try to do it alone but with a competent attorney who specializes in bankruptcy they will help you understand your options and avoid making bad decisions. You get one chance to file bankruptcy right the first time. Start by completing the form below and click submit and you are on your way. The consultation is 100% free.