Small Business Bankruptcy In Kentucky
Small business bankruptcy in Kentucky is a unique subset of law that demands attention to detail, knowledge, and a willingness to work with clients to understand their needs better. Each case is different with a unique set of requirements.
At Ron Adams Law, we take pride in setting a high standard and ensuring the process goes ahead as planned.
Overview of Filing for Small Business Bankruptcy
Filing for small business bankruptcy requires filling the appropriate paperwork, showcasing the necessary documents, and understanding your legal options as a citizen. These details will be focused on at the law firm to make sure your case is presented appropriately.
A trusted law firm recognizes what needs to be done and how to make sure the results are in line with your needs.
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Call to schedule your Free Bankruptcy Consultation!
Small Business Bankruptcy Basics
Chapter 7 – A business owner that has listed their business as a sole proprietorship/general partnership will be held responsible for all relevant debts. Chapter 7 allows you to file for bankruptcy in this type of legal situation. For this in a corporation/limited liability setup, personal bankruptcy is only filed when you are legally guaranteeing the listed debt.
Chapter 13 – For businesses rearranging their debts (i.e. consolidation), Chapter 13 can be used to file bankruptcy. This is generally reserved for those listing their businesses as a sole proprietorship/general partnership.
Why File for Small Business Bankruptcy?
- Best way to avoid having to deal with a long list of creditors
- Can help get out from under a significant amount of growing debt
- Businesses that are dealing with a lot of debt can reduce their obligations by taking this path while focusing on other loans
- Helps businesses dealing with significant contracts (sales, commercial lease, equipment lease) without making money
- Can assist those dealing with the aftermath of a lost lawsuit and the owed amounts
Tax Consequences in Small Business Bankruptcy
There are listed tax consequences associated with filing for bankruptcy as a small business owner. Debtors are accepted to file all relevant tax forms and make sure their taxes are deposited during the process.
All unpaid payroll taxes are immediately liable under the business owner’s name according to the IRS. This includes both state and federal income taxes along with Social Security taxes, Medicare, and unemployment insurance taxes. This is the state-s money and has to be returned to them as it was withheld from employees at the time of payment.
To handle the payments, business owners can file for bankruptcy and set up an installment plan if they can’t make up the lump sum. In rare situations, the IRS may be willing to negotiate on these amounts to get their funds back at a reduced rate.
Small Business Bankruptcy Legal Resources
- U.S. Bankruptcy Court (Kentucky) – http://www.kywb.uscourts.gov/fpweb/index.htm
- United States Small Business Admin – http://www.sba.gov/
- U.S. Bankruptcy Court (Southern Ohio) – http://www.ohsb.uscourts.gov/
Frequently Asked Questions
1. Who qualifies for bankruptcy?
Small business owners can qualify for bankruptcy depending on their debt and financial situation. This can be verified with the help of a legal professional.
2. What happens during a bankruptcy?
Each bankruptcy situation is unique, but the filing is done by filling out the relevant paperwork. This includes listing all relevant information about the business and its creditors.
To learn more about Ron Adams Law or set up an appointment, please call (859) 727-1000. When it comes to small business bankruptcy in Kentucky, this is the law firm for your needs.
LET OUR EXPERIENCE GUIDE YOU
Call to schedule your Free Bankruptcy Consultation!