Small business bankruptcy is a tool to reorganize. It doesn't necessarily mean you're going out of business.

Owning a small business can be extremely rewarding both personally and financially. There are times, however, when the financial side of things just doesn’t go as planned. 

There are many different reasons why small businesses have financial issues, but regardless of the case, bankruptcy can be a good tool to deal with the situation at hand. We can help.

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Navigating the complex small business bankruptcy process

Owning a small business can be extremely rewarding both personally and financially. There are times, however, when the financial side of things just doesn’t go as planned. There are many different reasons why small businesses have financial issues, and sole proprietorships can be especially stressful if you have no one to help you out. 

Regardless of the case, bankruptcy can be a good tool to deal with the situation when debts get out of hand and threaten to sink your business. When you are considering bankruptcy as a small business, the first thing to remember is that even if you file for bankruptcy it does not necessarily mean that you have to go out of business. While business bankruptcy can certainly be used as part of the going-out-of-business process, it is often used as a part of reorganization plans, to help avoid that result entirely. In fact, the Small Business Reorganization Act of 2019 made it easier for small businesses to reorganize under bankruptcy, protect their business assets under bankruptcy, and avoid Chapter 7 bankruptcy which liquidates the business.

Small Business Bankruptcy

 

Here at The Law Offices of B David Sisson, we have been helping small business owners in Oklahoma deal with their debt and bankruptcy issues since 1990. This level of experience won’t be easy to find anywhere else, and when combined with our passion for helping every client who walks through the door, you’ll see why we are the ideal choice when your business is having financial issues and you’re in need of a deep business reorganization and a clean slate. 

Chapter 11 Bankruptcy

Chapter 11 Bankruptcy was made specifically with businesses in mind, and the laws in the Bankruptcy Code that apply to this process generally allow the business to remain operating before, during, and after the bankruptcy process.

While in Chapter 11 bankruptcy, the courts will appoint a trustee, who will help to formulate a debt reorganization plan that will help the business as well as get the creditors as much of the money that they are owed as possible. The trustee will also have some oversight of the business to ensure it is being run properly in regard to its finances.

When the courts approve and recognize a repayment plan, the small business will need to begin making the agreed-upon payments. In most cases, the plan will include a combination of some debt being discharged, and some debt being retained and put on a reasonable payment plan. The bankruptcy process can also allow the small business to terminate contracts or leases that are deemed to be overly burdensome to the business.

 

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While Chapter 11 is the business bankruptcy by definition, it is not the only type of bankruptcy available to you. Chapter 13 bankruptcy has specific debt limits and is reserved for individuals or sole proprietorships, but it could be right for your business and circumstances. GIve us a call so we can assess your situation and advise you on how to best go about filing for bankruptcy to save your business.

Bankruptcy laws are very complex and frequently changing. This makes it very difficult, and extremely unadvisable, to attempt to handle a bankruptcy on your own. Having an experienced bankruptcy attorney working on your behalf will help ensure you get the best possible results from your Chapter 11 Bankruptcy - or whichever type we determine suits you best. We are here to work with you every step of the way, so please don’t hesitate to contact the Law Offices of B David Sisson today.

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When does it make sense to file for bankruptcy?

Many people struggle financially for months or even years trying to stay afloat. While bankruptcy should never be rushed into, it is also an important financial tool that can help you get back on your feet.

There are many situations where declaring bankruptcy can be a huge benefit.

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