While bankruptcy laws have made it possible for individuals and businesses to restructure their financial portfolios, filing for a business Chapter 7 petition is definitely something you don’t want to do alone. Working with a Dallas bankruptcy attorney can help you determine nuanced legal and financial matters such as whether your business can continue to operate after the business Chapter 7 filing. When you meet with your bankruptcy attorney, you’ll want to provide all the necessarily legal documents so that your lawyer can file the petition. Once the case is in the hands of the court, they will appoint a trustee to your case. Typically, there is a 60-day turnaround once a petition is filed.
Can You Stay in Business?
One of the key questions that owners have about a business Chapter 7 filing is whether or not they can continue operating their business. While a business Chapter 7 petition is usually linked with the dissolution of an enterprise, it is possible to keep operating, especially with the help of a bankruptcy attorney.
If you’re a self-employed business owner (sole proprietor), a bankruptcy attorney can help you explore all of your options. If you’re a sole proprietor, you can use a business Chapter 7 filing to wipe out both personal and business debts. This is one legal benefit that you have that partnerships, corporations, and LLCs don’t. A bankruptcy attorney will help you determine which assets are exempt so that you can keep your business and continue running as usual. This also ensures that you have the opportunity to negotiate with your creditors so that they don’t pursue your personal assets if the business’ assets aren’t enough to cover the liabilities.
However, just because you want to continue operating your business in hopes of a turnaround, this isn’t always feasible. A bankruptcy attorney will help you determine if the assets of your business outweigh the liabilities. If this is the case, then it might be worth trying to keep your door open. While sole proprietors can file for a business Chapter 7 and individuals can file for a Chapter 13, all other types of organizations will have to file for a Chapter 11 if they want to keep operating as usual.