Small Business Bankruptcy
Liquidation and reorganization
Businesses can file under Chapters 7, 11, and a new form of bankruptcy created in early-2020 referred to as Sub-chapter V. Depending on the size and complexity of your business and whether you intend to continue operating, you may be able to liquidate or reorganize under these chapters.
Chapter 7 Liquidation
Ending your business
Chapter 7 is reserved for business that want to shut down and liquidate their assets. Upon the filing of a Chapter 7 bankruptcy, the business immediately ceases operations and a trustee is appointed to liquidate the business for the benefit of creditors.
Small Business Chapter 11
Simplified reorganization for small business that want to continue operations
The small business Chapter 11 bankruptcy (also called Sub-chapter-V) was created in 2020 to deal with the problem that a "full" Chapter 11 is often to complex and expensive for smaller businesses.
Chapter 11 Bankruptcy
Bankruptcy for large businesses
A business that wants to continue operation and does not qualify as a small business for Sub-Chapter V, must file a Chapter 11 bankruptcy. The process for this is complex and requires experienced bankruptcy attorneys.