Small Businesses

How a Bankruptcy Attorney Can Assist a Small Business Owner

September 25, 2018 By Shari DeArmon

Business owners, depending on their business’s structure, can apply for Chapter 7, Chapter 11, or Chapter 13 bankruptcy. Each form of bankruptcy has its own set of benefits and weaknesses, and these benefits and weaknesses also depend on the owner’s business. Because there are so many variables when it comes to business debt, you should seek out the help of a bankruptcy attorney before choosing whether bankruptcy is right for your business.

Chapter 7 Bankruptcy for Sole Proprietorship

Though individuals, not businesses, commonly file Chapter 7 bankruptcy, a bankruptcy attorney could suggest this option. A Chapter 7 helps erase all personal unsecured debt. This can help you only if you have a sole proprietorship business. In a sole proprietorship, the court sees no difference between personal and business profit and assets. A bankruptcy attorney might suggest Chapter 7 if you are incapable of paying your business debts from your own pocket. You might find it difficult to keep your business running after the bankruptcy, however, because your business assets will be made available to your creditors unless you and your bankruptcy lawyer can find a way to exempt them.

Chapter 7 Bankruptcy for LLCs and Partnerships

LLC and Partnership businesses typically use Chapter 7 when they want a trustee to sell off their assets in a transparent manner. In many cases, filing Chapter 7 can actually hurt the owners of an LLC or a Partnership by making their personal assets available to creditors. A bankruptcy lawyer can assess the issues of your unique situations and help you determine the best course of action.

Chapter 11 Bankruptcy for All Business Structures

Filing Chapter 11 bankruptcy typically costs more bankruptcy attorney fees, but it is often the most flexible option if you can afford it. Chapter 11 works best for businesses that have hit a minor road block but that can realistically bounce back. The flexibility allows your business to stay open during the process and potentially thrive afterward. This is a high risk and high reward bankruptcy option that is beyond the reach of some sole proprietorship businesses.

Chapter 13 Bankruptcy for Sole Proprietorship

Only a sole proprietorship business can file a Chapter 13 bankruptcy. This type of bankruptcy allows you to restructure your business’s debts. If you helped keep your business afloat with your personal income, then filing a Chapter 13 can also help you restructure your own debt. The court, trustee, and creditors will come up with a repayment plan, and you might find yourself paying less than your original debts. If your business owes too much, however, you will be forced to file a Chapter 11 instead.

Contact a Small-Business Bankruptcy Attorney Today

At Groce & DeArmon, P.C., our team of lawyers have the experience needed to provide you with the best bankruptcy advice. A Groce & DeArmon, P.C. bankruptcy attorney would be happy to speak with you and get your business back to health.

Groce & DeArmon, P.C. on Companies Surviving Bankruptcy

August 18, 2017 By Shari DeArmon

Filing bankruptcy is certainly not limited to personal finances. There are countless examples of major companies and corporations that have had to ultimately close their doors due to bankruptcy. But, as an experienced law firm, Groce & DeArmon, P.C.’s bankruptcy lawyers and attorneys know that there are a few examples that aren’t quite as “doom and gloom”.

These are some example of companies that have managed to bounce back from bankruptcy and undergo effective course correction. If you’re looking for guidance for your own debt issues, Groce & DeArmon, P.C. is here to help you. Groce & DeArmon, P.C. is an experienced, professional and understanding law firm that has helped countless people through the bankruptcy process.

General Motors

By 2009, US car manufacturer General Motors had been dealing with years of falling profits. The drop off became sharp enough that by the end of the first decade of the 21st century, compounded by the global recession that hit a swathe of industries, GM was forced to declare bankruptcy. The filing lead to a major shakeup within the company, and in the years since they have rebounded back to being one of the leaders in the US motor industry.

Chrysler

Another victim of the 2008-2009 financial crash, Chrysler was forced to file bankruptcy along with General Motors. Just like GM, Chrysler had been a stalwart in the American motor industry and was one of the first to suffer as part of the collapse. Following a government bailout and a deal with Fiat, Chrysler has since recovered and seen healthy growth ever since.

Apple

MacBooks, iPads, and iPhones are part of the fabric of modern technology these days, so it may be hard to believe that, in 1997, Apple was forced to file bankruptcy. The company was partially saved by an investment from its rival, Microsoft, and the company would subsequently reinvent itself under the guidance of Steve Jobs.

The iPod, introduced in 2001, took the tech world by storm, and Apple has remained a software and hardware powerhouse ever since.

Marvel Entertainment

Superhero movies are now an industry in and of themselves, and Marvel heroes, in particular, currently lead with an entire shared cinematic universe that includes juggernaut blockbusters like The Avengers, Guardians of the Galaxy and, most recently, Spider-Man: Homecoming. But in 1996, superhero movies remained something of a Hollywood joke, and Marvel, in particular, was suffering heavy losses from a lack of interest in their comic book characters.

In 1996, Marvel Entertainment filed for bankruptcy, but the sale of some tentpole properties – Blade, X-Men, and Spiderman – led to Marvel being able to release movies under their own banner. Beginning with Iron Man in 2008, the shared Marvel cinematic universe continues to dominate the box office.

Groce & DeArmon, P.C. and New Starts

At Groce & DeArmon, we believe that if a major company with complex finances can rebound from having to file bankruptcy, then our clients are more than capable of doing it too. If you’re in need of help, whether you’re filing for Chapter 7 or Chapter 13 bankruptcy, contact a bankruptcy lawyer at Groce & DeArmon, P.C. for a free consultation.

Tips from a Law Firm: Bankruptcy and Your Small Business

April 14, 2017 By Shari DeArmon

As a small business owner, there are always a myriad of details that need to be tended to which will lead to success; however, sometimes life throws a curveball and can create a financially unstable situation for a small business. In these trying situations, a small business owner may be contemplating bankruptcy. Bankruptcy is a major consideration for a small business owner and there are some things to consider if you are looking at filing for bankruptcy.

The Purpose of Bankruptcy for a Small Business

When a business finds itself in financial problems with mounting debt and lowered income, finding the best options to either save the business or to liquidate may seem complicated and overwhelming. One goal of bankruptcy may be to protect the personal assets of the owners. Another goal may be to preserve the business and continue, if possible. Determining what sort of aid that a small business really needs and the best way out of a challenging financial situation can be learned from hiring an experienced bankruptcy attorney. Finding the right bankruptcy law firm is key in navigating an economic business downturn.

Which Type of Bankruptcy?

When a major company with stockholders and spot in the stock exchange files for bankruptcy, this is generally Chapter 11, which gives the corporation the opportunity to reorganize and survive. This type of bankruptcy is rarely appropriate for a small-to-medium size business because banks and creditors are not interested in financing legal proceedings to recoup their funds. Rather, a small business will file for Chapter 7 bankruptcy to liquidate a business, paying as many creditors as possible. Another type of bankruptcy for a small business is to file Chapter 13 bankruptcy. Chapter 13 will help a business continue if the requirements of lower debt with higher income and asset values are met. Sorting out the differences can be facilitated by hiring an experienced business bankruptcy law firm like Groce & DeArmon, P.C. to guide you through this process.

Choosing Your Bankruptcy Law Firm

Bankruptcy is a major consideration for a business of any size, and for the small business owner, it is important to find an experienced law firm with the knowledge, experience and compassion to lead you through the decision making process to find the best options for your small business. Finding a law firm that has a successful track record in helping small business owners navigate tough times, with a compassionate staff willing to take the time to answer all of your questions, can make a difficult situation less painful.

As southwest Missouri’s leading bankruptcy law firm, Groce & DeArmon, P.C. has a proven track record in helping small business owners navigate bankruptcy situations. Contact our staff today for a free consultation, or visit our website for more information.

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