Entrepreneurs are respected for a reason – it takes guts to start a business, and hard work to build a successful one. On top of those, there’s a fair amount of sheer chance involved. Sometimes the economy simply won’t permit it. In fact, it’s not even uncommon for a theoretically foolproof business concept to turn into a financial failure. Fortunately, just like a regular Tennessee citizen, a business can declare bankruptcy. If you’re the owner of a company that seems to be on its last leg, this means that you don’t have to give up the thing you’ve put so much time and effort into.
Individuals in the state of Tennessee who wish to file for bankruptcy have two options – Chapter 7 and Chapter 13. Businesses get one: Chapter 11. When they file under this type of bankruptcy, debt is relieved in much the same way. Filers and their attorneys work with creditors and their representation to draft a plan to pay back any debts. To qualify for Chapter 11, you must fall under on of the following four categories:
Just as individuals are never advised to file for any type of bankruptcy without legal advisement, businesses and other related entities should follow the same advice. The process itself is extremely complicated. Without adequate legal training, attempting to decode the labyrinthine legislation for business bankruptcy while simultaneously fending off creditors is a recipe for disaster.
If you’re filing under Chapter 11, you’re going to need to hire an attorney – and a good one. Just like plans for opening a business run a high risk of failure, so do those of Chapter 11 bankruptcy. Creditors are stingy when it comes to scheduling when they get their money. Oftentimes, there are disputes that surface as a result of drafting the bankruptcy plan. Sometimes trustees have problems too, which further complicates matters in terms of satisfying all appropriate parties. Potential external factors should be heavily discussed with an attorney during the period before bankruptcy is filed.
At Turner Law Offices, P.C. we believe that every small business needs at least some guidance from a business law attorney – especially if bankruptcy is being considered. Business bankruptcy can be a productive route toward financial stability, but it can easily turn foul without representation from an experienced attorney. And we are here to help. Call for an appointment with one of our business lawyers today, or set up your Free Initial Consultation online.
