Is Bankruptcy an Option for Your Small Business? Which chapter is it?
Is filing for bankruptcy in Centerport the best option for your small business? Which Chapter should you file your case under? Which one applies to your company? These are hard concerns with significant implications for how you should proceed. When you contact our small-business bankruptcy attorneys, we will conduct a thorough examination of your situation.
During a session with our attorney, we will assist you in making the best decision, obtaining the required documents, and answering even the most complex concerns about small business bankruptcy. Throughout New York, we have successfully represented countless individuals, companies, and small businesses as they emerge from bankruptcy. We have the skills and resources to assist you regardless of the specifics of your case.
In general, the bankruptcy chapters accessible to a small firm are determined by the type of legal entity:
A sole proprietorship: If the company is a sole proprietorship, the owner and the company are the same. This means the owner is personally liable for all of the company’s debts. If there is insufficient money to pay the debts, creditors may be able to seize the owner’s personal assets. When a sole proprietorship declares bankruptcy, the owner declares bankruptcy for himself as well. This is usually done through Chapter 7 bankruptcy.
A partnership: This involves two or more people collaborating as business co-owners. Unless the partnership is a limited liability partnership, each partner is individually accountable for the activities of the other partners. A partnership can file a Chapter 11 if it wants to continue functioning and reorganize its debts, or a Chapter 7 if it wants to cease operations and liquidate its assets.
Corporations and limited liability companies (LLCs): In this instance, the personal assets of the shareholders are normally protected from creditors. An owner’s personal assets are normally protected from business creditors in the event of an LLC. Corporations and limited liability companies can register under Chapter 11 or Chapter 7.