Small Business Bankruptcy

Centerville Small Business Bankruptcy Attorney

When your debt problems put your business at risk, it is stressful and frightening. Your livelihood is in jeopardy, and you need to know how you can get back on track financially. At Horwitz & Horwitz, LLC, we can help you explore your options and determine if bankruptcy is right for you. Call our firm today to speak to a Centerville small business bankruptcy attorney.

Filing for bankruptcy can allow you to resolve your financial difficulties, and it doesn’t have to mean the end of your business. Many businesses continue to operate even after the owner files for bankruptcy. In some cases, bankruptcy can help a business thrive by stopping creditor actions.

Filing for bankruptcy for your business may also protect your personal property. How bankruptcy will affect you depends on the type of business you own and the amount of personal assets you have tied up in the business. Depending on your situation, you may be able to file a Chapter 7, Chapter 13, or Chapter 11 bankruptcy. If you are the sole proprietor of a company, you and your business are considered the same entity. As a result, you must file a personal consumer bankruptcy. If you have a partnership, LLC, or corporation, other options are available to you.

Every situation is different. At Horwitz & Horwitz, LLC, we work with you to understand your unique situation and determine the option that best fits your needs. We know how important this is to you, and we are committed to providing personal attention every step of the way.

Bankruptcy filings, including Chapter 7, Chapter 11, and Chapter 13, increased 28 percent between April 2023 and April 2024. Commercial Chapter 11 filings increased 40 percent between January 2023 and April 2024. If your small business in Centerville, Springboro, Beavercreek, Miamisburg, or Kettering is struggling and you are constantly worried and stressed about your business finances, it may be time to consider Chapter 11 bankruptcy. Many people have small businesses as their primary source of income. When the economy crumbles or other issues crop up, your business may no longer be viable in its present state. 

You may be unable to pay normal business expenses and could be dealing with creditors calling you every day and harassing you about unpaid bills. Even though bankruptcy is much more common than it once was, there is still a certain social stigma attached to filing for bankruptcy. It can feel like a shameful thing, yet the reality is that everyone deserves a fresh financial start, whether personally or for their business. It can be beneficial to have a Centerville small business bankruptcy lawyer from Horwitz & Horwitz helping you through this difficult time. 

What is Chapter 11 Bankruptcy?

Chapter 11 is a type of bankruptcy that involves the court-supervised reorganization of a debtor’s assets and liability and is commonly used by businesses. Chapter 11 bankruptcy allows a company to remain in business while restructuring operations and finances. Any reorganization plan under Chapter 11 must be in the best interests of the company’s creditors. If no reorganization plan is presented by the debtor, the company’s creditors can propose one. Major corporations like United Airlines, Texaco, and General Motors have used Chapter 11 to restructure their debts while they continue to do business.   

Who is Eligible for Chapter 11 Bankruptcy?

There are no restrictions or limits regarding debt and income for Chapter 11 bankruptcy eligibility. Regardless of the type of business you own (small businesses, large national corporations, sole proprietorships, partnerships, etc.), you can file for Chapter 11. An “involuntary petition” is sometimes filed by creditors if you owe so much that it is unlikely your business can remain viable. You can also file for Chapter 11 bankruptcy on your own; this type of bankruptcy benefits those who have too much debt to qualify for Chapter 13 bankruptcy. 

Small businesses could potentially file for Chapter 11 under the Small Business Reorganization Act of 2019 or the Bankruptcy Abuse Prevention Consumer Protection Act of 2005. In the past, only large companies were able to afford the costs of Chapter 11 bankruptcy filing, but in 2019, the Chapter 11 U.S. Code was expanded, so that it now helps both large and small businesses.  For a small business to be eligible to file for Chapter 11, the total secured and unsecured debt must not exceed $3,024,725, and the business must be actively engaged in conducting business.  

Half of the total debt must be from business earnings, i.e., a business that is 100 percent involved in the ownership and management of a single property is not permitted. Under Chapter 11 rules, if an individual or business has filed for bankruptcy during the previous 180 days and that petition was dismissed because of a refusal to attend court or comply with directions from the bankruptcy court, they may not file for Chapter 11. 

What is the Process for Filing for Chapter 11 Bankruptcy?

Businesses that are eligible to file for Chapter 11 will need to provide:

  • A cash flow statement
  • The most recent audited financial statement
  • Business activity reports
  • A complete list of assets and liabilities
  • Statements detailing the sources and amounts of business income and expenditures
  • A complete list of contracts with creditors and unexpired leases
  • The most recent federal tax filing

Business owners, whether married couples or individuals, must have documented completion of credit counseling along with any debt management plan created during the counseling. Since additional forms and reports may be required, depending on the business and the circumstances, it is essential that you seek assistance from a Centerville Chapter 11 bankruptcy lawyer to ensure no details are overlooked. 

Once your Chapter 11 bankruptcy petition is filed and accepted by the court, all debt collection actions must cease. Creditors are required to temporarily lift or halt liens, lawsuits, and repossessions. These orders remain in effect until a debt repayment plan is approved by the court and accepted by creditors. 

Regular reports must be submitted regarding business income while the stay is in place. Once the court accepts the bankruptcy petition, the debtor has 120 days to prepare and submit a detailed plan for debt restructuring and repayment. The plan may ask creditors to lengthen the time for repayment, lower monthly payments, or settle for an amount that is less than the full amount due. 

Creditors will vote on this plan and may challenge any provisions they are unhappy with. As you might imagine, this can potentially take months—and multiple hearings. As the debtor, you are allowed, under Chapter 11 rules, to employ attorneys, accountants, appraisers, and other professionals to “assist” you during the Chapter 11 process. 

Like other bankruptcy proceedings, a court-appointed trustee will oversee the implementation of the debt repayment plan. Should you fail to adhere to the terms of the plan, lawsuits and collection efforts may result. If the Chapter 11 process sounds complex—it is! Having an experienced Centerville small business bankruptcy lawyer from Horwitz & Horwitz can make a significant difference in the process and the outcome of your Chapter 11 filing.  

How Can Filing for Chapter 11 Bankruptcy Help a Small Business?

If your business is collapsing because of too many financial obligations, Chapter 11 bankruptcy may be your lifeline. As a business, there are two bankruptcy options. You can file for Chapter 7 bankruptcy; however, your business will cease to exist, and business assets will be liquidated to pay as much of the business debt as possible. Chapter 11 allows your business to reorganize its debt and continue operations. The goal of Chapter 11 is to come out on the other side of the bankruptcy and reorganization of debts as a stronger business. Under Chapter 11 bankruptcy, the owner of the business can often negotiate more favorable terms for debt repayment than they could on their own. Chapter 11 bankruptcy allows you to:

  • Keep your business running throughout the process of Chapter 11 bankruptcy
  • Receive an automatic stay that stops creditor collections, repossessions, liens, levies, foreclosures, and lawsuits
  • Receive expedited assistance for your business including authority to continue operating the business and paying employees
  • Potentially obtain loans at more favorable rates
  • Receive permission to reject leases and contracts in which all parties have ongoing obligations
  • Sell assets the business no longer needs to generate cash and fund business operations
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What Sets Our Lawyers Apart?

Experience the Difference With Horwitz & Horwitz
  • Over Five Decades of Combined Experience
    With over 50 years of combined experience, Horwitz & Horwitz brings the skills to handle tough cases. Whether facing criminal charges or bankruptcy, we’ll guide you toward a brighter future.
  • Reasonable Fees, Realistic Solutions

    We believe in making high-quality legal representation accessible. Our firm offers reasonable fees and focuses on realistic, actionable solutions that align with your unique circumstances.

  • Client-Centered Approach
    At Horwitz & Horwitz, your satisfaction is our priority. Our business thrives on referrals from happy clients, which speaks volumes about the trust and relationships we build.
  • Strategic and Thoughtful Representation

    Every case is unique, which is why we develop tailored strategies tailored to your specific circumstances. We work closely with you to discuss options and maintain control over the direction of your case.

  • Free Consultations Available

    We offer free consultations to provide clarity, answer your questions, and help you confidently take the next step.

  • Personalized Representation from Start to Finish

    At Horwitz & Horwitz, your case is handled directly by our experienced attorneys. From consultation to resolution, we provide dedicated support every step of the way.

Hiring a Centerville Chapter 11 Bankruptcy Lawyer Near You to Help Your Business

The past couple of decades have seen financial devastation for many Americans—individuals and business owners. While bankruptcy should never be a financial option that is taken lightly, it can provide a reasonable solution for a business that is overwhelmed with debt. Choosing an experienced Centerville Chapter 11 bankruptcy attorney from Horwitz & Horwitz can help you move toward resolving your financial difficulties and getting a fresh financial start. Centerville bankruptcy attorney Barbara Horwitz founded Horwitz & Horwitz with Jon Horwitz thirteen years ago, and between them, Barbara and Jon have more than 53 years of combined experience. Contact Horwitz & Horwitz today.

Contact us today for a free consultation with an experienced Centerville small business bankruptcy attorney. Don’t wait to find out what you can do for your business.

We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.

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