Filing for bankruptcy protection is a very serious decision for all businesses. Regardless of operation size, there are continuing credit concerns for both the owners and their business entity venture. However, for many this step will be a necessity if they plan to continue operating in the aftermath of the health emergency environment. Restructuring financial obligations and maintaining cash flow is vital to any business, and sometimes bankruptcy is the only feasible method of accomplishing both tasks. The problem is that business bankruptcies can get complicated, and exemptions for personal bankruptcy often do not apply in a Chapter 11 business petition. This is why it is imperative to have solid legal counsel before beginning the process.
Preparing for Bankruptcy
All operation managers understand long before a needed bankruptcy is filed that they may need protection to remain in business. This time period can be used in a positive manner by preparing well in advance of the petition submission to the court. An experienced and detailed bankruptcy law professional can be a real asset in the preparation period by advising what to do with each account that will be listed in the filing. Sometimes outstanding debts and contracts can be renegotiated to keep them out of the requested account liabilities, and any creditor has a right to contest any bankruptcy petition. A trained bankruptcy legal professional will understand how to make those arrangements in many cases.
The Filing Chapter Matters Significantly
Small businesses are often sole proprietorship operations that can be included in a personal filing or a separate business filing. For these individuals, the personal bankruptcy rules and exemptions will apply. The problem is that partnerships and those already incorporated will have a more complicated process that will require the expertise of an experienced bankruptcy attorney to ensure that all legal technicalities are included in a petition. While many petitioners will be required to complete credit counseling within two weeks of the bankruptcy effective date, separate business filings fall under a separate set of rules. Each bankruptcy petition is unique in some aspects, and legal counseling can only be provided by a private attorney. Federal bankruptcy law prohibits the court from issuing any legal advice to those filing a pro se petition with the court.
While it is possible to file bankruptcy without a legal representative, it is never a good decision for most novice business owners and managers. Not only does the decision impact the business, it can have prolonged impact on the life of the petitioner when there are complications. Additionally, the court may not accept the petition in certain instances. It is always best to have experienced and detailed legal counsel when filing any bankruptcy chapter. Nevada business owners should always call the bankruptcy professionals at Fair Free Legal Services for effective legal representation and petition preparation for a successful outcome to their bankruptcy case.
Fair Fee Legal Services
8665 South Eastern Avenue, Suite 101 Las Vegas, NV 89123