Jun 07, 2010

Bankruptcy for Small Business Owners

If you're considering filing for bankruptcy because your small business cannot pull itself out of debt, you're not alone. While the economy's getting better every day and many businesses are finally showing a profit again, some businesses suffered too many losses during the height of the recession to be able to pay off their past due debt. If it looks like it's time to throw in the towel, you can use Chapter 7 personal bankruptcy to wipe out your liability for your business's debts and start over. 

It used to be hard to find information on Chapter 7 personal bankruptcy that addresses the concerns of small business owners, but Nolo has published a helpful new book on the subject: Bankruptcy for Small Business Owners: How to File for Chapter 7. (Disclosure: I'm one of the book's co-authors. I'm a little late in plugging the book; it's been out since March.) 

The book can help you decide whether chapter 7 personal bankruptcy is the best solution for you by teaching you about:
  • the difference between personal and business bankruptcy
  • how to determine whether you're personal liable for your business debts
  • which if your business debts and assets will be affected by bankruptcy
  • your eligibility for bankruptcy
  • exemptions that can protect your property, and 
  • what happens to your house and car in bankruptcy.
If you're considering closing down your business and filing bankruptcy to wipe your slate clean--or even trying to keep your business open but filing bankruptcy to get out from under your past debts, it might be helpful to you. You can read the first chapter for free on Nolo's site.