Bankruptcy is a hard prospect for any person or business to consider. It's not easy to look at the process as a way to start over because it often feels like failure. But a new start is exactly what the process is supposed to be, especially when businesses want to stay on track as they face their debts.
While you may know that there are clear distinctions between Chapter 7 and Chapter 13 bankruptcies, you may be more unclear with Chapter 11. As most Connecticut residents know, Chapter 11 bankruptcy primarily benefits business owners and corporations, although a small number of individuals can also take advantage of this option. Before you commit to a plan, you should clearly understand how these bankruptcy types differ.
The modern age of internet shopping and big box stores hasn’t been good for many companies, even stores that have been successful for decades. Competition can be good when it keeps prices down for consumers, but too much of it can make it hard for some stores to compete. Consequently, some have no choice but to file for Chapter 11 bankruptcy or close their doors. Many residents of Connecticut and elsewhere may consider the closing of numerous iconic stores the end of an era.
You have experienced financial difficulties for several months, but you tried unsuccessfully to get your head above water and conquer your insurmountable debt. You realize that the time has come to consider filing for bankruptcy. A bankruptcy discharge could solve many of your problems, you realize, but you also worry that you might not qualify for Chapter 7 because you have a steady income and may not pass the means test. You and other Connecticut residents may benefit by learning how a Chapter 11 bankruptcy could be the better option.
At the Law Offices of Charles A. Maglieri in Connecticut, we know that creating and running your own business is your “American Dream.” Sadly, however, statistics show that most business start-ups fail. If yours faces overwhelming debt, you undoubtedly have numerous questions about what a small business Chapter 11 bankruptcy entails and what happens to the debts your business accumulated. Are you held liable for them?