It is certainly understandable why the owner of a small Florida business would believe that his or her company was ineligible for bankruptcy protection under a process more customarily associated with individuals and families having non-business debt.
In many instances, though, it is thankfully the case that such an assumption is incorrect. In fact, and as we note on our Miami Small Business Bankruptcy page at Kingcade & Garcia, P.A., many owners of relatively smaller business companies can take advantage of the wide range of protections conferred through Chapter 7 bankruptcy.
Unfortunately, business principals often receive accurate debt-related information only after they have spent considerable time, effort and money negotiating the steep learning curve associated with various bankruptcy offerings and other potential avenues for reducing their debt.
It is a common, for example, for beleaguered business owners to immediately focus their energies on Chapter 11 bankruptcy, which can be an exceptionally pricey and complex debt-relief vehicle. Moreover, this type of bankruptcy is often not even appropriate for a sole proprietorship or other small business entity.
A Chapter 13 filing is also an option that many business owners explore. Although Chapter 13 might in fact be a solid debt-relief option for some businesses, it is wholly inappropriate for others, especially those that lack sufficient income to repay any portion of their debts.
A Chapter 7 filing often turns out to be a very sound strategy that can benefit small businesses just as much as it does traditional consumers. As we note on our above-cited website page, it “can be a very powerful tool for a small business owner.”
Our law firm can explain why, with our principal attorney being both a long-tenured bankruptcy attorney and a certified public accountant who has helped many debtors — including business owners — overcome challenges and regain financial traction.