Chapter 12 Bankruptcy
The United States Bankruptcy Code has been crafted and revised to accommodate the needs of debtors in all manner of different circumstances. Individuals most typically find their needs are addressed by the provisions of Chapter 7 or Chapter 13. While most businesses seek relief from creditors under Chapter 7 or Chapter 13, there are some that find Chapter 12 Bankruptcy to be beneficial.
This form of bankruptcy is not well-known and is limited to small farms, ranches, and fishing operations that meet certain filing requirements. Typically regarded as “family” businesses, these enterprises tend to have a different debt, asset, and income profile.
If you are feeling panicked by debts and expenses associated with your small business, it may be appropriate to consider filing for bankruptcy protection. A skilled and experienced bankruptcy attorney can offer guidance as to which form of bankruptcy would be best suited to your situation. For a free initial consultation, contact the Boston bankruptcy lawyers of Joshua Spirn & Associates at 800-975-5346.
Chapter 12 Filing Considerations
Though it may not always feel as if it is so, the Bankruptcy Code generally aims to enable a resolution of debts that is fair to both debtor and creditor alike. One way that this concern is addressed is by attempting to limit abusive filings, a measure that can be implemented by utilizing strict filing requirements. Some Chapter 12 filing considerations include:
- 80 % or more of the debts covered by the bankruptcy must be related to the business operation
- 50 % or more of a debtor’s income in the year prior to the filing must have come from the farming operation
- There must be evidence of sufficient income to permit payments pursuant to the bankruptcy plan during reorganization
Contact Us
Let us help you preserve your dreams or your family’s legacy. Contact the experienced Boston bankruptcy lawyers of Joshua Spirn & Associates at 800-975-5346.
