Bankruptcy – Is it Time to Consider?
No one wants to think about declaring business bankruptcy, but when you take a critical look at your books and the numbers do not add up, it may be time to start considering it. The simple reality of life is that events will not always unfold the way you planned. Even if you came up with a seemingly foolproof business plan, the unexpected can still knock you down. Rather than dwelling on this temporary defeat, it may be prudent to cut your losses and explore your options.
There are four different types of bankruptcy that you can look at as a business owner, depending on your circumstances. These include:
- Chapter 7 – Liquidation, or Chapter 7, is the path you take when you see no future recovery for your business. This is often the choice for small businesses based around the owner’s skills.
- Chapter 11 – If you are up for reorganizing your business, this is the option to go with. When you decide to declare chapter 11, be aware that your business will be under much tighter scrutiny in the future.
- Chapter 12 – This option allows you to repay your debts in installments but if typically designed for farmers and fishermen.
- Chapter 13 – Though this is typically used by consumers, sole proprietors can explore this option. If you have personal assets tied into your business, you can use this to devise a repayment plan and diminish personal loss.
No matter what option seems to best fit your business, you will want to consult with a Boston business attorney to determine how to efficiently execute your plan.
Ensuring Your Survival
Should you decide that it is time to declare bankruptcy, choosing the right option can have a big impact on your future endeavors. Reorganizing may sound attractive, even in the most dire circumstances, but you should still make sure it is viable before you attempt it.
If your business has been operating in the red, it may be time to talk with a Boston business attorney about business bankruptcy. While this is certainly not the path you envisioned when you started your business, it can, with swift and proper action, protect you and your family from financial ruin and even help you strategize for the future. If your family business is faltering and you wish to seek out the best professional advisers to help navigate through those turbulent times, contact Jeffrey Cymrot of Sassoon & Cymrot for individual guidance and consultation.