Business Bankruptcy in Jacksonville FL

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Bruner Wright, P.A., is a bankruptcy and business law firm that puts its customers first. We focus on providing legal representation to businesses and individuals in bankruptcy and business litigation matters. We are also experienced in estate planning and probate matters. Our firm has extensive experience in these practice areas which results in our clients feeling a much needed sense of calmness during turbulent times.

If you’re facing financial hardship with your business in Jacksonville FL and are unable to pay creditors or vendors, you may want to consider filing for business bankruptcy in Jacksonville FL. While starting a business comes with risks, bankruptcy can offer relief and a fresh start for owners facing challenging situations. The right chapter of bankruptcy to file under will depend on the specifics of your case, so it’s essential to discuss your options with an experienced Jacksonville bankruptcy lawyer.

At Bruner Wright, we can help you navigate the complexities of business bankruptcy and provide guidance on the best course of action for your unique situation. To schedule a consultation, call us at 904.432.1200.

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File Chapter 7 Bankruptcy for Your Business

Chapter 7 bankruptcy is often the best option for businesses that are closing their doors. Individuals and companies can file for Chapter 7 bankruptcy. This allows the liquidation of non-exempt assets. If a business has few assets, it can file for bankruptcy and discharge most of its debts. The court will approve the application for bankruptcy. After the closing, creditors, and lawsuits are not possible.

Although sole proprietors, corporations, partnerships, and corporations can all file for Chapter 7 bankruptcy, the consequences for the owner and their ability to discharge debts will differ. It is possible that the assets of individuals may remain on the table. To fully understand the implications, it is important to speak with an attorney.

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What Type of Bankruptcy Is Right for Me?

In the United States, individuals typically have two main options for personal bankruptcy: Chapter 7 and Chapter 13. On the other hand, Chapter 11 is primarily intended for business bankruptcies. However, small businesses in Jacksonville, Florida have the flexibility to choose between Chapter 7 and Chapter 13, depending on their specific circumstances and needs.

Chapter 7 bankruptcy, often referred to as “liquidation bankruptcy,” involves the sale of non-exempt assets to repay creditors. It is suitable for individuals or businesses with limited income or resources and who are unable to repay their debts. In this process, a bankruptcy trustee may sell non-exempt assets to generate funds to distribute among creditors. Once the debts are discharged, the debtor is relieved of most, if not all, of their outstanding obligations.

Chapter 13 bankruptcy, known as “reorganization bankruptcy,” allows individuals or businesses with a regular income to create a repayment plan to settle their debts over a period of three to five years. This option is beneficial for those who have a steady income but are struggling with overwhelming debt. Under Chapter 13, debtors can retain their assets while repaying creditors through the court-approved plan.

For small businesses in Jacksonville, Florida, the choice between Chapter 7 and Chapter 13 depends on their specific circumstances. They can evaluate factors such as the nature and size of their debts, income, assets, and long-term viability to determine which bankruptcy option aligns better with their goals and financial situation.

 

Is Your Jacksonville Business Struggling? Could a Business Bankruptcy Be the Right Answer?

Even larger corporations and businesses are experiencing financial difficulties and a decline in business. Only around 20% of small business owners achieve success, while the remaining 80% face debts and expenses and require a solution for their closed operations. If you own a struggling business in Jacksonville, Florida, a business bankruptcy could be the most viable option.

Business bankruptcies, whether in Jacksonville, Florida, or anywhere else in the USA, follow a federal court procedure specifically designed to aid the business in either repaying its debts or eliminating them under the guidance and protection of the Bankruptcy Court. A business filing for bankruptcy is commonly referred to as either reorganization (restructuring) or liquidation, depending on the chapter.

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Chapter 11

Some businesses may be able to recover from financial difficulties. In those cases, Chapter 11 could be the best option. Chapter 11 is a restructuring of the business and repayment of certain debts over a specified period. As part of bankruptcy, the business might be able to terminate certain leases or contracts.

This can help the company recover its profitability. The continuing business will be monitored by a court-appointed trustee, and creditors can weigh in on the repayment plans. If the judge feels that the plan is fair, the court can approve it. Chapter 11 bankruptcy is a complex process that can take a while and may not provide relief for all.

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Chapter 13

A Chapter 13 bankruptcy allows a person to create repayment plans and repay many of their debts over a three- to five-year period. The court must approve the repayment plan if it is fair and the debtor can afford the payments. Filing for Chapter 13 has many benefits. It provides protection for assets and allows people to catch up on their car or mortgage payments. Chapter 13 is also helpful if the debtor has secured debts that they can’t discharge in Chapter 7.

Many sole proprietors are tied to their business and personal assets. Chapter 13 may be the best option for these people. In any case, the business owner should speak with an experienced Jacksonville attorney to learn about their legal rights.

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What Our Clients Say About Us

I had such a good experience with my case with this firm!! They are all very nice, reasonable and caring about your situation and super thorough. I filed a ch 7 in October 2018, was discharged in January 2019 (so fast only 3 months) bought my very first ever new car in March 2019.

Jessica A.

This is the best law firm I have have ever worked with. They were very honest, professional, and responsive. Robert and Trey worked very hard to create a best case scenario for me. My case was complicated and required high level negotiations. In less than 4 months, I received the best possible outcome! They were a lifesaver for me!

Melissa O.

Extremely knowledgable and experienced Bankruptcy attorneys who are compassionate and diligent for their clients. I have sent them many satisfied clients and will continue to do so because their fees are fair and their staff is top notch! A+ firm in my book.

Hal L.

Bankruptcy Options for Jacksonville  Businesses: Liquidation, Reorganization, and Debt Adjustment

Chapter 7 bankruptcy is utilized when a business has no future and is at risk of failure. It is commonly referred to as liquidation because the business debts are typically substantial, making any restructuring efforts nearly impossible. This chapter of bankruptcy law applies to any business structure.

Chapter 7, which primarily focuses on the assets of the sole proprietor, is suitable when the business possesses minimal assets.

To file for bankruptcy under Chapter 7, the applicant must undergo the Means Test. This test determines if the applicant’s income exceeds the allowed income level. In most cases, if the Means Test is not passed, filing for bankruptcy under a different chapter of the bankruptcy law becomes necessary. If the test is passed, the Chapter 7 petition is approved, and the business is dissolved.

This type of bankruptcy in Jacksonville, Florida involves the court appointing a trustee to assume control over any assets possessed by the business and distribute them among the creditors. For sole proprietors, the discharge is granted once all assets have been distributed and the trustee has received payment. Discharge is not granted to corporations or partnerships.

Chapter 7 bankruptcy is utilized when a business has no future and is at risk of failure. It is commonly referred to as liquidation because the business debts are typically substantial, making any restructuring efforts nearly impossible. This chapter of bankruptcy law applies to any business structure.

Chapter 7, which primarily focuses on the assets of the sole proprietor, is suitable when the business possesses minimal assets.

To file for bankruptcy under Chapter 7, the applicant must undergo the Means Test. This test determines if the applicant’s income exceeds the allowed income level. In most cases, if the Means Test is not passed, filing for bankruptcy under a different chapter of the bankruptcy law becomes necessary. If the test is passed, the Chapter 7 petition is approved, and the business is dissolved.

This type of bankruptcy in Jacksonville, Florida involves the court appointing a trustee to assume control over any assets possessed by the business and distribute them among the creditors. For sole proprietors, the discharge is granted once all assets have been distributed and the trustee has received payment. Discharge is not granted to corporations or partnerships.

Chapter 11 bankruptcy is the optimal choice when your business is facing challenges but has a high likelihood of recovery. This chapter is commonly utilized by corporations and partnerships, although it can also be employed if your sole proprietorship surpasses the income threshold for Chapter 13. In Chapter 11 bankruptcy, a trustee appointed by the bankruptcy court will oversee the operations of your business during the reorganization process.

This chapter entails formulating a plan that outlines the rights and responsibilities of the creditors. Chapter 11 bankruptcy allows for the termination of leases and contracts, retrieval of business assets, partial repayment of debts, and discharge of the remaining balance. Creditors vote on the proposed reorganization plan and submit it for court approval if it is deemed fair and equitable.

Chapter 11 bankruptcy can be an intricate and lengthy process that often fails. Confirmation from creditors could take anywhere between six months to one year for approval of your reorganization plan.

How Is Your Jacksonville Business Structured?

When considering bankruptcy for your business, whether in Jacksonville, Florida, or elsewhere in the country or state, it is crucial to select the appropriate chapter of bankruptcy law that suits your case and aligns with the structure of your business. This careful choice will ensure that you achieve the desired results.

There are three main types of business structures:

  1. Sole Proprietorship: This type of business is considered a legal extension of the business owner. As a result, the owner (you) assumes full responsibility for all the liabilities and assets of the company. In this situation, a Chapter 13 business bankruptcy can be the optimal solution. It allows for the reorganization and repayment of debts, ensuring that no business or personal assets are lost in the process.
  2. Partnership: In this business structure, the company is a separate entity from the owners, safeguarding assets owned personally by individuals outside of the business. With this structure, Chapter 7 or Chapter 11 business bankruptcy is typically the preferred choice.
  3. Corporation: When it comes to business bankruptcy, corporations are structured similarly to partnerships, both in Jacksonville, Florida, and the rest of the United States. Chapter 7 and Chapter 11 are commonly used for corporations seeking bankruptcy protection.

Closing a Business and Bankruptcy

Chapter 7 bankruptcy is usually appropriate when the individual plans to close their business. Because they believe their business can rebound, some business owners choose to go after a different chapter. Business owners often turn to loans to help them get their businesses back on track. In these cases, anyone who is in this situation must look at their business and assess its viability. The owner must still have the plan to generate revenue. Restructuring doesn’t fix the business. The owner might need to calculate additional costs, such as marketing expenses, in order to ensure that they can continue their business after the restructuring process is complete.

In some instances, it may not be necessary to file for bankruptcy to close a business. Negotiating with creditors can be a viable option for business owners in these situations. An experienced lawyer can assist with these negotiations and determine if they are possible based on the specific circumstances of the business. While closing a business can be a challenging experience, it doesn’t necessarily mean that the owner cannot start a new one. Often, entrepreneurs learn from their previous business endeavors and are able to apply these lessons to new ventures.

With determination and the right resources, starting a new business can be a possibility for those who have faced financial difficulties with a previous venture.

Our Jacksonville Business Bankruptcy Attorneys Can Help

Making the decision to file for bankruptcy can be a daunting and overwhelming task. While you may not want to take this step, it’s essential to recognize that bankruptcy laws and protections exist for a reason, and they can be extremely beneficial for both individuals and businesses. Filing for bankruptcy can provide you with a fresh start, relieve your financial burden, and give you the opportunity to rebuild your financial future. Nevertheless, it’s crucial to consult with a skilled Jacksonville bankruptcy lawyer who can guide you through the complex legal process and help you make informed decisions.

If you’re looking for a competent and compassionate bankruptcy lawyer in Jacksonville, look no further than Bruner Wright. With years of experience, Bruner Wright has a deep understanding of bankruptcy law and a proven track record of helping clients achieve their financial goals. Whether you need assistance with Chapter 7 bankruptcy, Chapter 13 bankruptcy, or debt relief, Bruner Wright is here to help.

To learn more, call the law office of Bruner Wright P.A. at 904.432.1200.

Jacksonville Business Bankruptcy FAQs

The U.S. The U.S. The U.S. Bankruptcy Trustee reviews operating reports filed by debtors and tracks the progress of the case when compared with benchmarks that are set early in the case.

Not all business bankruptcy cases are filed voluntarily. Involuntary bankruptcy occurs when creditors file a petition to declare bankruptcy on behalf of the debtor. It can be under Chapter 7 or 11 of the bankruptcy law. To file an involuntary business bankruptcy petition against a company you must meet certain requirements. They include:

  • If three or more creditors petition the court, your company will be subject to the proceedings. However, if your company has fewer than 12 debtors, a single creditor can initiate the petition.
  • These creditors must hold non-contingent and undisputed claims that amount to at least $16,750, resulting from the debtor’s failure to pay their debts on time.
  • The custodian, who may also be an assignee of creditor benefit, has taken possession of your business assets.

Business bankruptcy can be circumvented through an assignment to creditors, which is regulated by state law rather than the U.S. Bankruptcy Code. In this scenario, the debtor (you) agrees to appoint an assignee who assumes control over all company assets and property. The assignee then liquidates these assets, and the proceeds are utilized to fulfill the creditors’ claims following legal requirements.

This approach serves as an alternative to Chapter 7 and Chapter 13 bankruptcy. However, it is governed by state laws and does not offer the automatic stay protection provided by bankruptcy for businesses. Choosing this option instead of bankruptcy can result in lower administrative costs and a shorter timeframe.

Chapter 7 bankruptcy is only a viable option if you are unable to sustain operations for your business. It entails the liquidation of all business assets and property, leading to the dissolution of the company. Chapter 7 bankruptcy might be the most suitable solution if you are insolvent or close to insolvency. The automatic stay is activated upon filing the bankruptcy petition, which prevents creditors from pursuing debt collection until the bankruptcy court has reviewed the case.

In most instances, a Chapter 11 bankruptcy is filed with the aim of restructuring and reorganizing a company’s financial affairs. It allows your business to continue operating while meeting its obligations to creditors. According to the bankruptcy code, the debtor has 120 days from filing the bankruptcy petition to submit a comprehensive reorganization plan. The court may grant significant extensions to this timeframe. Once the 120-day period has elapsed, the court will also consider the creditors’ plan. Legal representation by an attorney is necessary for any Chapter 11 bankruptcy, whether it is in Jacksonville, Florida, or any other location within the United States.

Ready to Get Out of Debt?

Our experienced business bankruptcy attorney in Jacksonville FL is here to offer a FREE consultation for your case.