Business Bankruptcy

2020 has  been a particularly difficult year for many businesses throughout the  United States due to the coronavirus pandemic. According to Yelp.com’s Local Economic Impact Report,  over 97,966 businesses have permanently shut down during the COVID-19  pandemic. If your business has been affected by COVID-19 closedowns, or  you have incurred personal debt due to other burdens to keep your  struggling business afloat, filing for bankruptcy may help you find the  financial relief that you need.

At Robert J.  Adams & Associates, our attorneys are committed to offering  comprehensive representation to business owners and entrepreneurs  throughout the Chicago area on all bankruptcy-related legal matters. Our  skilled business bankruptcy attorneys can review the details of your  case, discuss the unique details of your personal situation, and help  you understand all of your business bankruptcy options. We will offer  you the experienced legal guidance and advocacy you need to navigate key  decisions throughout any bankruptcy proceedings.

Robert  J. Adams & Associates is proud to represent business owners  throughout Chicago, Illinois, including the surrounding areas of  Waukegan, Lake County, Cook County, and DuPage County.

WHAT YOU SHOULD CONSIDER WHEN IT COMES TO FILING FOR BANKRUPTCY

Seeing  a business that you built using years of hard work and struggle can be  really heart-breaking. Nonetheless, filing for business bankruptcy does  not necessarily mean the end of your business. Rather, it provides you  with a debt relief option that could provide you with the opportunity to  restructure. However, there are a couple of factors that must be  considered before choosing the appropriate bankruptcy chapter that best  suits your unique situation and needs. When reviewing your bankruptcy  options, one of the factors to consider is the legal structure of your  business. This may include:

LIMITED LIABILITY COMPANIES (LLC)

LLC  offers corporate protection to its members. Therefore, they are not  personally liable for any debts and liabilities incurred by the company.

PARTNERSHIP

A  partnership is an association of two or more persons serving as the  co-owners of a business. Partners can be held liable for liabilities,  debts, as well as actions of the partnership.

SOLE PROPRIETORSHIP

In  a sole proprietorship, the business owner has total control over the  business, receives all profits, and pays taxes. However, both the  owner’s personal and business assets may be exposed to liability.

ARE YOU FACING BANKRUPTCY?

CREATING A PLAN FOR YOUR BUSINESS MOVING FORWARD

Despite  our best efforts, the business may not succeed. Moreover, keeping a  struggling business afloat will only make you incur more personal debt.  In order to determine the ideal bankruptcy option for your business, you  need to consider the plan you have for the business moving forward.

For  instance, do you prefer closing the business for good, or are you  searching for a way to still keep the business afloat while you rebuild  and restructure?

WHICH BANKRUPTCY OPTION IS RIGHT FOR YOUR BUSINESS?

Your  business structure and plan for the business moving forward will help  you determine the right bankruptcy chapter that best fits your unique  situation and needs. Those bankruptcy options include the following:

CHAPTER 7

Chapter 7 bankruptcy,  often referred to as “liquidation” bankruptcy, helps individuals and  businesses clear away most of their general unsecured debts so that they  can secure the”fresh start” that they need. As a sole proprietor, you  and your business will be treated as a single entity. Thus, filing for  Chapter 7 bankruptcy using your name can help you discharge some of your  unsecured debts.

Conversely, Chapter 7  bankruptcy isn’t typically favorable for an LLC or partnership, since  such business structures don’t allow debt discharge. Filing for Chapter 7  bankruptcy will only increase the liabilities of members or co-owners.

CHAPTER 11

Chapter 11 bankruptcy,  often referred to as “reorganization” bankruptcy, allows business  owners to reorganize the business affairs, operations, assets, and  debts. In Chapter 11, the debtor is allowed to propose a payment plan to  repay creditors while keeping the business afloat.

Chapter  11 bankruptcy is usually more suitable for partnerships and LLCs.  However, filing for this bankruptcy option can be expensive, lengthy,  and time-consuming. Additionally, the Illinois court or creditors need  to approve the repayment plan before moving forward.

CHAPTER 13

In the state of Illinois, filing for chapter 13 bankruptcy involves setting up a repayment plan to pay down your debt. Through  Chapter 13, business owners are able to reorganize and repay all or some  of their debts through a repayment plan spread across three to five  years, and the business owners will be allowed to keep their assets.  Also, the business owner can discharge a wider range of debts using  Chapter 13.

Since Chapter 13 is considered a  “wage earner’s plan,” it is only available to sole proprietors who file  as individuals. This option ensures that there is no direct contact  between the business owner and the creditors. The business owner is  required to divert all disposable income into the repayment plan and  report to a court-appointed trustee. The trustee then distributes all  payments to any creditors.

WHY YOU SHOULD WORK WITH EXPERIENCED BUSINESS BANKRUPTCY ATTORNEYS IN CHICAGO, ILLINOIS

Business  disruptions and volatile markets have resulted in debt and liability  for many businesses across the nation. In such situations, bankruptcy  can truly mean a fresh start and an opportunity to recover from  devastating financial issues. If you’re considering filing for  bankruptcy, a knowledgeable Illinois business bankruptcy attorney can  offer you reliable guidance by helping you review all of your legal  options.

At Robert J. Adams & Associates,  our attorneys have devoted their careers to providing experienced legal  counsel and representation to business owners throughout the bankruptcy  filing process. As your legal counsel, our attorneys will evaluate your  unique situation and determine the bankruptcy option that is right for  you and your business. Our team will help you file your forms, represent  you throughout any court proceedings, and offer you the experienced  legal guidance you need to navigate all key decisions at every turn.


RELIABLE BUSINESS BANKRUPTCY ATTORNEYS SERVING CHICAGO, IL

If your business is going through financial hardship and considering  filing bankruptcy, contact Robert J. Adams & Associates today to  schedule a one-on-one consultation. Our attorneys can offer you the  comprehensive legal counsel and advocacy you need to navigate the  complexities of any bankruptcy proceedings so that you can get the fresh  start that you deserve. If you live in Chicago, Waukegan, Lake County,  Cook County, or DuPage County, Illinois, and are looking for bankruptcy  help, contact our office today!

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