If you are in a situation where your small business is failing and you are not able to pay your creditors, it is essential that you understand how Small Business Bankruptcy in Indianapolis, IN works. You must also understand the various options that are available and which one would be most beneficial to your business model. Selecting the right option will have a substantial impact on whether or not you can retail your business assets and if you are going to incur costly expenses and fees. The options that are available are highlighted here.
Chapter 7 Bankruptcy
This is commonly referred to as a liquidation and the appropriate action when a business does not have a future and it does not have the proper assets. This is why it is the most popular option for small businesses and sole proprietorship’s, since the company is essentially just and extension of the skills of the owner.
Chapter 11 Bankruptcy
If you have plans to fully recover your business, the Chapter 11 option will support the continuation of the business under your reorganization plan. This is often a complex process, but one that any type of business can file.
Chapter 13 Bankruptcy
This type of bankruptcy is one when you create a repayment plan with the bankruptcy court that details how you plan to repay your debts. This is usually saved for consumers; however it is also able to be used for sole proprietorship’s. If you have personal assets tied with your business assets you can avoid the chance that you may lose your house by filing a Chapter 13 rather than a Chapter 7.
Chapter 12 Bankruptcy
This type of bankruptcy has been specifically designed for “family fishermen” or “family farmers.” This plan allows you to make installment payments to creditors for a period of three to five years.
It is a good idea to discuss your options with a bankruptcy attorney to choose the right type of bankruptcy for your situation. Small Business Bankruptcy in Indianapolis, IN can be tricky and complex, which is why it is highly advised you seek assistance. This individual may also be able to help you with finding a Social Security Disability Attorney in Indianapolis, IN to ensure your business is covered in any type of situation.