Business Bankruptcy Lawyer
Alfred Abel is a Business Bankruptcy Lawyer Providing Effective Business Bankruptcy Solutions in Philadelphia and Throughout Pennsylvania
Today, more than ever, businesses of all sizes are under significant financial pressures. When those financial pressures lead to an inability to pay creditors or manage mounting financial obligations, seeking relief through bankruptcy provides a means to eliminate or reduce debts and restructure/reorganize business operations and continue to serve customers.
For many businesses in Philadelphia and across Pennsylvania, it can be challenging to stay afloat during a fluctuating and volatile economy. We understand this better than most. For over 35 years, Alfred M. Abel has served the Philadelphia area as a bankruptcy attorney for business bankruptcy filings. At Alfred Abel Law Offices, helping companies and small businesses determine the right bankruptcy solution is what we do.
What is Business Bankruptcy?
Business bankruptcy is the legal process that provides businesses of all sizes to manage their debt and financial obligations through restructuring or liquidation. From sole proprietors and partnerships to limited liability companies and corporations, bankruptcy can be a powerful financial strategy for a struggling business.
Types of Business Bankruptcy Solutions We Provide
Federal bankruptcy law provides several bankruptcy solutions for businesses in financial trouble. Determining which bankruptcy is appropriate for a company depends on several factors, including its organizational structure, financial situation, and whether or not the business intends to continue operations. Referred to as chapters, each type of bankruptcy is named for the Chapter where they appear in the U.S. Bankruptcy Code. Business bankruptcies are filed in the federal bankruptcy court.
Chapter 7 Business Bankruptcy
Chapter 7 of the U.S. Bankruptcy Code provides financial relief to a business through liquidation. Available to both individuals and companies alike, a Chapter 7 business bankruptcy closes down the business and liquidates its assets for the benefit of the creditors. Most types of businesses are eligible to file for Chapter 7, including limited liability companies, corporations, partnerships, and sole proprietorships. Chapter 7 bankruptcy is most often the bankruptcy solution chosen by sole proprietors.
Chapter 11 Business Reorganization
Chapter 11 of the U.S. Bankruptcy Code provides businesses that are structured as corporations, partnerships, or limited liability corporations the ability to reorganize their debts while continuing business operations. By filing Chapter 11, an automatic stay stops any existing litigation and any efforts to collect debts against the company that exist on the filing date.
To qualify for bankruptcy under Chapter 11, a business must have regular revenue and submit a reorganization plan to the bankruptcy court, demonstrating how the business plans to repay outstanding debts. Before the reorganization plan can be submitted and approved by the court, the company’s creditors must review and approve the reorganization plan. Throughout the reorganization process, the bankruptcy court has control over and authority to approve major business decisions like entering into contracts, expanding or shutting down the business, or selling the business’s assets.
Chapter 13 Bankruptcy for Sole Proprietors
Chapter 13 of the U.S. Bankruptcy Code is available to both individuals seeking personal bankruptcy relief and individuals running a small business as a sole proprietor. This is because sole proprietors are considered personally liable for all business debts. Like Chapter 11, under Chapter 13, sole proprietors petition the bankruptcy court to allow reorganization of both personal and business debts and negotiate with the trustee appointed by the court to pay back debts owed. Not all creditors get paid, and some may get only a small percentage of their debts repaid. There are, however, some limitations with a Chapter 13 business bankruptcy. These include:
- Debt Limits: To qualify for Chapter 13, the maximum amount of debt is restricted to less than $1,257,850.00 for secured debts and less than $419,275.00 for unsecured debts (amounts are adjusted periodically).
- Repayment Period: A debtor has three to five years to pay back debts according to the reorganization plan.
Is Business Bankruptcy Right for Your Philadelphia Business?
In an ever-changing economic climate, many businesses are facing an uphill battle trying to stay afloat managing mounting debt and an uncertain future. If your business is suffering financially, now may be the time to explore your options including business bankruptcy. Whether it is time to consider closing down your business or keeping the doors open while you restructure operations, seeking legal advice from an experienced business bankruptcy lawyer will provide the guidance you need to make the right decision for your company.
Alfred Abel is well-versed in handling bankruptcy cases, and we have extensive experience in representing creditors. Bankruptcy can be complicated and creditors need to have a lawyer who will work to achieve a positive outcome for them. We will help you protect your interests and receive as much compensation as possible on debts owed to you.
Contact Alfred Abel Law Offices for a Skilled Business Bankruptcy Lawyer
If your business is being impacted by financial difficulties, bankruptcy may be something you face, either as a debtor or a creditor. You need guidance from an experienced professional about the right course of action for your situation. Contact business bankruptcy attorney Alfred M. Abel for a consultation to determine if bankruptcy is right for your business.