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Factors to Consider When Filing for Business Bankruptcy:
Howard Tagg is an experienced business bankruptcy attorney and can help you.Bankruptcy can help you whether you wish to continue or shut down your business. The type of bankruptcy that can benefit you the most depends on your business structure and if you intend to stay in business.
Factors to Consider When Deciding to Continue Your Business:
There are many factors (from personal to financial) to consider before deciding to continue or close down your business.- Is the Business Making Money? Chances are, you started your business to make a profit. If your business is consistently losing money (not just because it is a slow period) it may be time to close up shop. If you own a profitable company that is facing hard times due to temporary factors such as the economy, it may be a good idea to stay operational and weather the storm.
- Are the Assets of The Business Worth More Than Its Liabilities? If your business has more assets than liabilities, then it may be worth saving. If it is severely upside down, it may be time to cut your losses.
- Are You Personally Liable for Business Debts? If you are personally on the hook for the debts of your company, it may be more advantageous to keep it running (without taking on more debt), at least while you negotiate with creditors. Closing down the business may leave creditors with no option but to go after your assets if the business does not have enough assets to cover its liabilities.
What Type of Bankruptcy Should You File if You Wish to Continue Your Business?
The answer depends on how your business is organized and the number of assets it has. Chapter 7 Bankruptcy When Continuing Your Business:Which Type of Bankruptcy Is Best When Closing Your Business?
If you wish to close down your business, a Chapter 7 can provide a hassle-free way to liquidate it. How many assets the business has and whether you are personally liable for its debts will determine whether a Chapter 7 is in your best interest. Chapter 7 Bankruptcy When Shutting Down Your Business: Chapter 7 is a liquidation bankruptcy normally used when closing down a business. There are no exemptions and the business does not receive a discharge. The bankruptcy trustee simply sells all business assets and distributes the proceeds among its creditors.The benefit of liquidating your business by filing a Chapter 7 is that the trustee does all the work for you. Additionally, the automatic stay of the bankruptcy court will immediately stop all pending litigation and collection activity against the business.
There are many factors to consider when filing a business bankruptcy, and it is essential to obtain the advice of competent bankruptcy counsel throughout the process to achieve the most beneficial outcome for you and your business.If you would like more information about bankruptcy, contact the Law Office of Howard Tagg today at (903) 581-9961 to schedule your free consultation or fill out the form below.