I own a company that is severely in debt, and I signed a personal
guarantee on most of its debt. I do not have a reasonable expectation
to be able to pay all of the debt back. My attorney is recommending
to me that I file personal bankruptcy, and that I don't bother filing
bankruptcy for the corporation since corporate bankruptcy doesn't
discharge debt. He said that people may sue the corporation, but
since there isn't any assets to grab, any judgements would sort of be
a moot point.
(QUESTION) Is it common just to shut the doors like that, not filing
for Chapter 7? Are there disadvantages to doing this?
He's also stating that the day after the personal bankruptcy is
approved that I can form a new company.
(QUESTION) What kind of things should I make sure to avoid to not get
into any type of successor corporation liability? |
Clarification of Question by
mdarling-ga
on
26 Jun 2006 22:23 PDT
I should have mentioned that it's chapter 7 that my attorney is
recommending that I file personally.
|
Request for Question Clarification by
cynthia-ga
on
27 Jun 2006 04:36 PDT
What state?
|
Clarification of Question by
mdarling-ga
on
27 Jun 2006 06:50 PDT
Michigan
|
Clarification of Question by
mdarling-ga
on
27 Jun 2006 06:51 PDT
Oh, and I just noticed a typo in my original post.
First question should not be regarding not filing Chapter 7, it should
be about not filing Chapter 11. Opps!
|
Request for Question Clarification by
cynthia-ga
on
27 Jun 2006 13:11 PDT
Typos! That's fine! I was thinking about your question whilst
looking at another and referenced your Michigan! [there]...
Anyway, I fought a successorship label/status, there is a lot to
beware of. I don't have much time today to search, you can start by
entering this:
avoid successorship
...into Google and browsing for ideas.
|
Clarification of Question by
mdarling-ga
on
27 Jun 2006 16:36 PDT
Thanks for your response. I'll continue to do some searching. One
thing that I want to mention is that I keep seeing employee / benefit
/ etc liability on a lot of tye searches. My company doesn't have any
type of liabilities like that. All the employees were in college,
there were no benefits, retirement packages, etc.
The only type of liabilities outstanding is rent for our commercial
space, credit cards, leases, utilities, etc.
|
Request for Question Clarification by
cynthia-ga
on
27 Jun 2006 17:52 PDT
Did you send all the funds as required to the appropriate agencies
regarding Social Security, Unemployment, Workers Compensation
Insurance and State and/or Federal Income Taxes? Therein lies the
trap...
|
Clarification of Question by
mdarling-ga
on
27 Jun 2006 18:40 PDT
I should have written my last comment clearer, lol.
I owe some taxes as you mentioned (sales tax & employment taxes), all
of which are being personally assessed to me. And these cannot be
bankrupted. So, although those liabilities will stay with me, that'll
happen whether I start a new business or not.
Please correct me if I'm wrong about these liabilities applying to me
personally and not being able to bankrupt them.
However, at this point, I think I'm just worried about the creditcard,
loan, utility debt and the new company some day.
|
