Kentucky Business Bankruptcy Lawyer
Bankruptcy: Starting Over with a Clean Slate
When you build a business, you hope for success and may not prepare for anything else. In our challenging economy, many companies must reassess their future and consider alternate ways to survive. Filing for bankruptcy may be one option.
Initial reactions to the idea of bankruptcy are often negative, but using this process correctly can make the difference between closing your doors forever and being able to begin again. Bankruptcy laws are intended to give a fresh start to those people and businesses who find themselves drowning in large amounts of debt. The process is designed to help eliminate or repay debt under federal guidelines.
Why Choose Bunch & Brock for Your KY Business Bankruptcy
At Bunch & Brock, we are familiar with every aspect of debtor and creditor issues, in and out of a bankruptcy setting. Our founding member, W. Thomas Bunch, has over 50 years of experience representing financially distressed companies. He has built a powerful firm that stays informed of the constantly evolving bankruptcy laws and makes the most out of the opportunities afforded by them.
The protection available to your business depends on its type. Whether you are part of a sole proprietorship, a partnership, a corporation, or a limited liability company, a Lexington business bankruptcy lawyer from Bunch & Brock can help. We have helped thousands of consumers and corporations successfully navigate these often-confusing times.
We are committed to supplying you with the services you need to secure a better financial future. We have worked with thousands of clients to lower the amount of debt they owe, often eliminating it completely, while increasing the period of time in which the debt has to be paid. We are confident we can do the same for you and your business.
We Are Committed to Helping You Understand How Business Bankruptcy Might Be Right for You
Running a business is not easy, and neither is navigating the complexities of bankruptcy law. While you may have heard of a “Chapter 7” or a “Chapter 11” bankruptcy, did you know that there are actually five types of bankruptcies outlined by the federal Bankruptcy Code? The numbers refer to corresponding chapters that address different situations and offer different relief. Corporate bankruptcies are most commonly filed under Chapters 7 and 11. For municipalities considering bankruptcy, assistance from a chapter 9 bankruptcy lawyer in Lexington can be invaluable in understanding and navigating this less common, but critical, path.
Chapter 7 Bankruptcy: Liquidation
Chapter 7 is the most frequent form of bankruptcy filing and is also one of the fastest ways to start over. The main principle of Chapter 7 bankruptcy is liquidation, which means that the business stops operating, and anything it owns is turned over to a trustee for sale. The proceeds are paid out to the business’s creditors to satisfy as many debts as possible, including lease obligations, credit cards, loans, and contracts. For guidance through this process, it is advisable to consult a chapter 7 bankruptcy attorney in Lexington.
Personal liability for the business debt is not erased by a business bankruptcy. This debt can be discharged only through a Chapter 7 personal bankruptcy or by negotiating a settlement with the creditors.
If you are the sole owner of a corporation or LLC or are involved in a partnership, the intricacies of bankruptcy law make it crucial to speak with a lawyer if you are interested in filing a business bankruptcy. Proceeding without skilled legal representation from an experienced business bankruptcy lawyer could cost you even more than what you already owe.
Chapter 11 Bankruptcy: Reorganization
In contrast to liquidation, the main principle of Chapter 11 bankruptcy is a reorganization. Your business will be given a certain period of time to pay back its debts under better terms. By filing for Chapter 11, a distressed business may be able to rehabilitate itself while staying largely under the control of the business owner.
With the help of a skilled Lexington business bankruptcy attorney from Bunch & Brock, you can create a customized strategy to reorganize your business’s debts to more favorable terms. A carefully thought-out and well-advised approach allows you to come out of bankruptcy with a refreshed financial outlook.
Should You Liquidate or Reorganize? We Can Help You Decide.
When you are facing the potential of filing for bankruptcy, you are already under stress and may be unsure of your options. Knowing whether to liquidate or reorganize is a challenging decision, and the best answer varies with each set of circumstances.
There are many factors to consider, including the following:
- Whether the business is making money: If you are making profits but at a lower level than you had hoped, your primary difficulties may be due to temporary causes.
- Whether the business has more assets than liabilities: You may need to sell assets to pay creditors under the supervision of a court trustee.
- Whether you are personally liable for business debts: Creditors may be able to come after your personal assets, depending on how your business is structured.
At Brunch & Brock, we will evaluate your situation with you and explain your options. While the rules applying to business bankruptcy may appear clear-cut, we have found that many owners become overwhelmed. Our experience and understanding of the law allow us to clearly outline our recommendations for your unique circumstances. Your Lexington business bankruptcy attorney can help you achieve the best available outcome.
Benefits and Drawbacks of Chapter 7 Bankruptcy
As you discuss your business future with the team at Bunch & Brock, you will come to understand the pros and cons of each method of filing for bankruptcy. Chapter 7 can benefit your company since you are allowed to keep certain exempted property and you are granted a legal release from your debts to get a fresh start.
The drawbacks of filing Chapter 7 may seem onerous, but they are necessary. You will have to stop all operations and essentially go out of business. A trustee will be put in charge of discharging your company’s assets (liquidation), using the proceeds to pay off the business debts. As many assets as possible will be sold to satisfy all creditors.
Benefits and Drawbacks of Filing for Chapter 11 Bankruptcy
When you file a Chapter 11 bankruptcy motion, you are working on reorganizing and stabilizing your business. You will get breathing room from the demands of your creditors so you can create a repayment plan. Your company can keep operating, and you do not have to sell all your assets immediately. Seeking guidance from an experienced Chapter 11 bankruptcy attorney is crucial during this process to ensure that you navigate the legal complexities and formulate a successful reorganization strategy.
Some drawbacks of Chapter 11 are that it is very complex and expensive. The time it takes to complete the process may cause your company to struggle, because your attention will be divided. Working with a skilled business bankruptcy attorney can enable you to stay calm through this process.
The Bankruptcy Process: Step by Step
Bankruptcy is overseen by the Federal Rules of Bankruptcy Procedure and local rules of each judicial district’s bankruptcy court. There are forms to complete and formal legal procedures required to correctly process and receive a bankruptcy ruling. The business bankruptcy lawyers at Bunch & Brock are thoroughly trained in handling all aspects of working within these courts.
For Chapter 7 filings, the process includes the following:
- You and your attorney file a bankruptcy petition.
- A trustee is assigned who will take over the company’s assets.
- The trustee sells (liquidates) as many assets as needed, minus exempt property, to satisfy the creditors’ claims.
- You receive a discharge of debt within a few months after filing your bankruptcy petition.
For Chapter 11 filings, the process is as follows:
- You and your lawyer file a petition for bankruptcy.
- You file a plan of reorganization within 120 days of filing your case, including a disclosure statement to creditors.
- The court approves or disapproves your plan of reorganization.
- If approved, you can pay a portion of some debts, discharge others, terminate contracts, lease assets, and rescale your operations.
- You complete a period of consolidation and emerge with reduced debt and a reorganized company.
You must also notify your state treasurer’s office so you can handle your tax obligations. Within Kentucky, you will contact the Kentucky Department of Revenue, Division of Collections, and provide your bankruptcy case number, as well as the date you filed. You must submit any tax returns you have not already filed, paying any taxes due after your filing date.
Do I Need to Hire a Business Bankruptcy Lawyer?
When you are worried about losing money or even your entire business, it might seem unwise to pay more money to hire an attorney. However, when you are frustrated and unsure, navigating the legal system without qualified representation can be a nightmare.
Bankruptcy does not have to be seen as a failure. It often serves as a strategic business decision that can rescue your company and its future. If done thoughtfully and with skilled guidance from the business bankruptcy attorneys at Bunch & Brock, you can pay creditors most of what you owe and get back to building your business again.
Some critical reasons why you should rely on a Bunch & Brock bankruptcy lawyer include:
- We have deep knowledge of state and federal bankruptcy laws, applying them to the greatest advantage for our clients.
- We have years of experience with the local court system and know how to adjust the details of your case for local preferences.
- Our work with previous clients lets us guide you in developing workable business reorganization or liquidation plans.
- We can answer all your questions concerning your legal options and how to reach your desired outcome.
Choose a Kentucky Business Bankruptcy Lawyer from Bunch & Brock Today
Making the choice to undertake a business bankruptcy filing is a tremendous step. It can be life or death for your company, and you should not try to handle it alone. You need someone with the qualifications, experience, and integrity to ensure you come out in the best situation on the other side.
When you hire a Kentucky business bankruptcy lawyer at Bunch & Brock, you can trust that we take the financial welfare of your business seriously. We will listen to your concerns, answer your questions, and develop a strategy to meet your goals. We offer over 30 years of service, helping our clients with compassion and excellence.
Contact us today at 859-254-5522 or through our online form to discuss your future.