Business Bankruptcy

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Business Bankruptcy New York

Just like individuals, businesses sometimes reach a point where their debt-to-income ratio is unsustainable. While businesses may have various options, including dissolving the business in order to pay off creditors, one option may be filing for business bankruptcy. A Kingston bankruptcy attorney with experience working with businesses can guide your company through the process and support your interests along the way.

Business Bankruptcy in Kingston, New York

There are three primary types of bankruptcy that can be filed by businesses:

Chapter 7 bankruptcy. Chapter 7 bankruptcy, or liquidation bankruptcy, can be used by both individuals and small businesses, including corporations, partnerships, and sole proprietorships. This type of bankruptcy is used by a business when there is no hope of restructuring; the debt burden is too high and the business’s income and assets are too low. During this type of bankruptcy, a trustee will be appointed who will be responsible for distributing business assets to creditors. At the end of the case, remaining debts will be discharged.
Chapter 13 bankruptcy. Chapter 13 bankruptcies are for individuals. As such, they can be used by businesses that are classified as sole proprietorships, but not partnerships and corporations. In a Chapter 13 bankruptcy, a business owner will enter into a repayment plan with creditors that lasts for up to five years. At the conclusion of the five years, remaining debts will be discharged.
Chapter 11 bankruptcy. For businesses that may have the ability to turn things around, Chapter 11 bankruptcy is best. This type of bankruptcy is used by businesses large and small — GM, Chrysler, and even Apple have all filed for a Chapter 11 bankruptcy at some point. Known as a reorganization bankruptcy, a Chapter 11 allows a business to work with creditors to file a detailed reorganization plan that includes repayment for some debts.

Why Work with a Kingston Bankruptcy for Business Attorney?

For businesses that are insolvent and are looking for ways to improve their financial future and keep the business afloat, filing for bankruptcy may be the best — and only — option. Before making that decision, though, it is strongly recommended that you consult with a skilled bankruptcy for business attorney who can advise you of your options and help you to understand which type of bankruptcy is best. Filing for bankruptcy is a big undertaking and a legal process. What’s more, the outcome of a bankruptcy will have a significant impact on your future and the viability of your business. Filing for bankruptcy on your own, especially as a business owner, is not recommended.

Call our Kingston Bankruptcy Attorneys Today

If you have questions about filing for bankruptcy as a business owner, working with an attorney is strongly advised. An attorney can guide you through the various options for bankruptcy and the process for each. To learn more, schedule a consultation with a bankruptcy for business attorney in Kingston at your convenience. You can call The Law Firm directly today or send a confidential message online.