Chapter 13 as another tool for business debt relief

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Chapter 13 as another tool for business debt relief

This blog has discussed on previous occasions what small businesses in the Tallahassee area can do should they find themselves facing financial problems.

Along with the options already discussed, a Chapter 13 bankruptcy may be a viable means of debt relief. Not every business can use a Chapter 13, as corporations, limited liability companies, and the like are not eligible since Chapter 13 is for individuals and couples.

However, someone with what is called a sole proprietorship or who is involved in a general partnership may use Chapter 13 as a means of resolving both his or her business debts and other personal debts. The reason for this is that, legally speaking, the debtor is just as liable for the business debts as he or she is for other, personal loans like a house or a car.

While the debtor must still meet all of the other eligibility requirements for a Chapter 13, the big advantage to this type of bankruptcy is that he or she may be able to use a flexible repayment plan to get rid of outstanding debts while continuing to operate his or her business at a profit. The debtor will, in any event, have to demonstrate some ability to make a monthly payment toward all or part of his or her outstanding debts.

Although a Chapter 13 can help a small business owner keep his or her enterprise afloat, filing for this type of bankruptcy, formulating a reasonable payment plan that meets the requirements of the law and then following through on that plan can be a complicated process. As such, a Florida business owner in financial trouble may want to seek the assistance of an experienced bankruptcy attorney.

2018-05-25T13:13:05+00:00 May 25th, 2018|debt relief, debtrelief|