Chapter 11 Bankruptcy for Small Businesses
The recent severe economic downturn adversely affected many businesses, but the small enterprise has been especially hit hard. Hundreds of thousands of businesses had to close their doors permanently because they could not meet their financial obligations as profits dwindled. If your business is in difficult financial straits you should work with a Cleveland business attorney who can help you determine your best course of action.
Bankruptcy and Small Businesses
If you run a small business you actually have some options regarding bankruptcy. It cannot be stressed enough, however, that you need to discuss your situation with a Cleveland business lawyer first to decide whether an alternative solution to bankruptcy exists. If not, the attorney can help you decide whether you should proceed with a Chapter 7, Chapter 13 or Chapter 11 bankruptcy.
If you wish to remain in business a Chapter 7 is not right for you. If dissolution of your business seems your best course, though, a Chapter 7 can enable you to literally wipe the debt slate clean. Chapter 13, similarly, is fraught with limitations in that it is largely meant for individuals and not businesses. If yours is a sole proprietorship, Chapter 13 reorganization may be in your best interests. If, however, yours is a limited liability corporation, partnership, or corporation, you cannot file Chapter 13.
Chapter 11 Bankruptcy
Like a Chapter 13, Chapter 11 is a debt restructuring bankruptcy. As such, you submit a plan for reorganization to the bankruptcy court, and if there are no objections, the judge will approve it. A Chapter 11 can enable the small partnership, LLC, or corporation to continue operating while reducing debt and modifying payment contracts. As your Cleveland business attorney will tell you, this in turn means that your business has through this a means of returning on a solid financial footing.
Work with a Cleveland Business Lawyer on Your Bankruptcy
If you are planning to file a bankruptcy on behalf of your business, whether it is a Chapter 7 or Chapter 11 it is very important that you do so under the guidance of a knowledgeable and experienced Cleveland business attorney. Call Shapero & Green today at 216-831-5100 to arrange a consultation.