Business Bankruptcy Lawyer Kansas City
Not all businesses become successful. Some fall victim to circumstance beyond their control. Business bankruptcy is a legal process designed to discharge all or pay your debts. It should only be availed as a last resort as there are also negative consequences, such as loss of property or having a bad credit score on your credit report.
Three types of bankruptcy:
1. Chapter 7.
Usually referred to as liquidation because all assets of the debtor that are not labelled as protected will be liquidated and distributed to the creditors. Afterwards, the owner of the business receives a discharge which means that the business is released from its debts.
2. Chapter 11.
Also known as reorganization and is the better choice for filing bankruptcy. Here, the business is reorganized in accordance with the best way to deal with its creditors. The business also gets to continue its business throughout the reorganization process.
3. Chapter 13.
Although chapter 13 is known as considered as personal bankruptcy, it can still be applicable to business bankruptcy, specifically those under sole proprietorship. Here, a repayment plan is filed in the bankruptcy court. The business’ income, how much is owed, and properties under the business are considered in order to determine how much needs to be repaid.
The enumeration above are the options a business can pick when filing for bankruptcy. In order to know which option is more suitable for your business or which option is more convenient for you, just contact Paulus Law Firm. We will help you decide as well as represent you.