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Bankruptcy for Small Business Owners

Bankruptcy for Georgia Small Business Owners

Georgia bankruptcy attorneys obtain effective debt relief for neighborhood businesses

Small businesses may be thrown into economic crisis by circumstances beyond their control, which can often lead to bankruptcy. The Small Business Reorganization Act of 2019 created a viable alternative for business owners who are not ready to fold up their companies in the face of financial disaster. Subchapter V is a streamlined bankruptcy proceeding that lets small businesses continue operating while restructuring and repaying their debt over time. The attorneys of Jeff Field & Associates advise on bankruptcy for Georgia small business owners with a view toward the best path for achieving debt relief.

What are the types of bankruptcies for a business?

There are two main types of bankruptcy relief available to businesses. Chapter 7, also known as liquidation, requires the business to turn over most of its assets to a bankruptcy trustee, who uses them to pay off creditors to the extent possible. The remaining debts are discharged and the business ceases to exist. The other option is Chapter 11, which allows a small business to remain in operation while reorganizing its debt in accordance with a court-approved plan.

Subchapter V is a scaled down version of Chapter 11 tailored to businesses for whom the normal reorganization process is typically too expensive and cumbersome. A small business can use Subchapter V if its debt is less than $7.5 million and if at least half of that amount is business debt, not the personal debt of the owner. The business can pay off most of its debts within three or five years.

What happens when a small business files for bankruptcy in Georgia?

Once you file for bankruptcy, your creditors must stop all efforts to collect on debts, which means avoiding foreclosure of business property. If you choose Subchapter V, your business can continue normal operation. If you file for Chapter 7, you will eventually have to close your business but you can keep any property you are entitled to exempt and start over with those assets if desired.

Will personal bankruptcy affect my small business?

Sometimes, small business owners need to file for consumer bankruptcy. This may be the case because the business is a sole proprietorship or partnership or because the owners are personally liable for some of the business’ debts. If the business is a corporation ohttps://www.fieldlawoffice.com/consumer-bankruptcy-in-georgia/r another entity separate from its owners, an owner’s personal bankruptcy will not directly affect the business. However, the bankruptcy of a sole proprietor or partner puts all of the business assets at risk. We can discuss how your personal bankruptcy may affect your small business and guide you on the best procedure to follow.

How long does the bankruptcy process take?

Chapter 7 and 11 have very different timetables. Chapter 7 can take a matter of months, which can be beneficial if your goal is to free yourself quickly of business debt and make a fresh start. Subchapter V requires the debtor to commit to a three- to-five-year repayment plan, but this is preferable if your objective is to keep the business solvent and return it to profitability

What happens to your credit after a business bankruptcy?

If you are personally liable for business debts, either as a sole proprietor, general partner, co-debtor or guarantor, the business’s bankruptcy will appear on your credit report for up to 10 years and will negatively affect your credit to some extent. However, you might still be able to secure a loan to start a new business. We can advise you on how to get back on track after a business bankruptcy.

Contact a Georgia small business bankruptcy attorney

Jeff Field & Associates helps Georgia small business owners pursue the most effective bankruptcy options. To schedule a debt relief consultation, call 404-381-1278 or contact us online. We have offices in Scottdale, Gainesville, Marietta, Lawrenceville, Douglasville and Athens.

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    5.0/5.0

    Chris and Laura have been amazing! The process seamless! All of my questions and needs were addressed! I highly recommend this office for your BK needs!

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    Crystal Jackson

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    This is the best Bankruptcy Lawyers ever They treat you with respect and do not judge you for the mistakes you made.Mr.Sleeper and MS.Brown are the best they answered every question I had and if I couldn't reach them they always responded to my voice...

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    Mwells

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    Jeff Fields and Laura Everett were wonderful! It was hard but they were so helpful and with me every step of the way. They answered every question and were very accessible. I hope noone has to experience this road, but if you do, try Jeff Field & Ass...

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    Becky Sharpe

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    I had my concerns about filing initially, but Jeff walked me through the process and with his calm demeanor, made this process not at all as daunting as I initially thought it would become. The process flowed effortlessly and Cassie (a BIG shout out ...

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    Charita Willis

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    Due to medical expenses and serious physical problems I had to file bankruptcy. I was nervous and really depressed about the whole situation. I called Jeff Field & Associates and felt at peace after talking to a lawyer. I decided to go with them and ...

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    Sherri Ellis

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