Limited Liability Companies (LLC), like corporations, are separate legal entities from their owners, and as such they cannot use Chapter 13 bankruptcy, which is for individual bankruptcy filings.
If your LLC has acquired an insurmountable level of debt, you have two options when it comes to bankruptcy, Chapter 7 and Chapter 11.
Under Chapter 7, your business will be shuttered and its assets sold in order to pay your creditors. Any debts you have personally guaranteed will remain with you if they are not paid off in the liquidation.
Meanwhile, in a Chapter 11 filing, you’ll ask for court protection while you restructure the business and liquidate unprofitable components in order to pay creditors.
This can be a very expensive approach to debt problems, and won’t be appropriate for most small businesses and even many medium sized firms.
The attorneys at Zelenitz, Shapiro & D’Agostino can help you learn how to move forward, by liquidating a business that’s failing, or by working with you to get your business out of debt and back to growing.
Call us today at 718-599-1111 for a free consultation with a Queens bankruptcy attorney.