Can I Still Continue to Operate If My Business Files For Bankruptcy?
Can I Still Continue to Operate If My Business Files For Bankruptcy?
Whether you are starting a business or closing your existing one, there is a possibility that you will have to file for bankruptcy. Bankruptcy is a process that allows companies to recover from crippling debt. It can allow businesses to restructure their finances and become more efficient operations. Getting your debts under control before filing for bankruptcy can save substantial legal expenses.
Types of Bankruptcy
There are several types of bankruptcy available. Choosing the right one for your business will depend on your specific needs. A bankruptcy attorney can help you determine what’s right for you. Whether you’re a small or large company, there are many benefits to filing for bankruptcy. There are also some disadvantages to each type.
Requirements
In order to qualify for bankruptcy, you must meet certain requirements. The law was designed with businesses in mind. There are also special protections for businesses that allow you to continue operating after bankruptcy. While this may sound like a positive for you, it isn’t for your creditors.
The trustee
In a typical bankruptcy case, a court-appointed trustee will sell the business’s assets, and the proceeds will be paid to the business’s creditors. However, the trustee may also try to find money from a partner’s personal assets to pay off the business’s debts. This type of bankruptcy may not be suitable for small businesses, especially sole proprietors. However, it can be a good solution if you need additional property or a better debt repayment plan.
Benefits of filing for bankruptcy
The main benefit of filing for bankruptcy is that it will stop creditors from coming after you. In the past, reorganizing your business through bankruptcy was not a feasible option for small businesses. However, recent changes in the law have made it easier for small businesses to file for bankruptcy.
Operating after declaring bankruptcy
The law is complex, and there are many moving parts. However, it is possible to file for bankruptcy which will allow you to keep your business running and still have some money to give to your creditors. You may be surprised by how many companies are still operating after filing for bankruptcy. In fact, many large companies are still operating, and many smaller businesses are using personal guarantees to back up their loans.
Hire a bankruptcy attorney
A bankruptcy attorney can help you decide which type of bankruptcy will best meet your needs. In addition to business bankruptcy, there are also personal and corporate bankruptcy options available. The law is very complex, so you should hire a lawyer with experience to guide you through the process. Choosing the right option for you may save you from substantial legal costs, and your business may be able to continue operating after filing for bankruptcy.
Subchapter 5
In addition to the typical business bankruptcy case, you may also qualify for a special type of bankruptcy known as a “Subchapter 5.” This type of bankruptcy is designed for small businesses that have little or no cash to give to their creditors. This type of bankruptcy significantly cuts down on the typical length of a bankruptcy case.
If you need legal advice about filing for bankruptcy or are in need of an attorney you can call this law firm, you can get a free consultation with the Best Attorneys in Utah.
Ascent Law LLC:
8833 South Redwood RoadSuite C
West Jordan, UT 84088
(801) 676-5506
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https://www.ascentlawfirm.com/bankruptcy-lawyer/
Disclaimer: This is not legal advice and is simply an answer to a question and that if legal advice is sought to contact a licensed attorney in the appropriate jurisdiction.
