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The Basics of a Small Business Bankruptcy

If you are small business owner where your business is run into serious financial difficulty you may have to consider bankruptcy as a resource to help you get it straightened out. There are some benefits to going into a business bankruptcy as it can help to actually save your business, as well as remove your personal liability towards the business debts. It can also be a resource to simply liquidate the company and allow it to close so you can have a fresh start.

What you want to do or what you want the outcome of your business to be will dictate which bankruptcy you need to file for whether it is a personal bankruptcy, a business bankruptcy, or even both.

Depending on your circumstances you may have the choice between a Chapter 7, a Chapter 11, or Chapter 13 bankruptcy. They each come with their own positives and negatives. Which one that you will be eligible for, and which one is best for you will all depend on the way your business has been constructed and the type of debts that you have.

Often business owners are confused as to just what they are liable for. If you are the only owner of the business which means that you are a sole proprietor or you are a general partner of a partnership, then you have some personal obligations towards the finances of your company. This means that if the business is not able to meet the financial responsibilities then the creditors of the business may be able to come after your personal assets. It is important that you discuss your business situation in its entirety with your proposed an Indiana bankruptcy lawyer.

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