Things to Consider when Filing for Business Bankruptcy

In recent years, the number of people filing for bankruptcy has been on the rise. With this increase in bankruptcy filings, there has also been an increase in the number of bankruptcy lawyers who practice in this area. If you are considering bankruptcy, you need to consider your options very carefully. Your bankruptcy lawyer can explain what is involved in filing for bankruptcy and what steps you will need to take to ensure that your bankruptcy petition is valid. He can also guide you through the bankruptcy process if you are not sure how to proceed.

The best way to get started is by discussing your options with your bankruptcy lawyer. He or she can tell you which bankruptcy option is best for you depending on your circumstances. For example, some people who are under financial distress may find it best to file for chapter seven bankruptcy, which liquidates property and settles debts for the remaining balance. Others may have more complex financial issues and will probably need to file for chapter thirteen, which declares that the individual or family is insolvent. In order to determine which bankruptcy option is best for you, your bankruptcy lawyer should analyze your financial situation along with your income and expenses.

 

Another thing that your bankruptcy attorney can advise you about is filing for discharge with the IRS, which allows you to discharge part or all of your unsecured debts without owing more money than you currently owe. This discharge does not release your tax liabilities, but does relieve you of the obligation to pay those liabilities. If you are able to obtain a discharge, it will keep your tax returns active for up to five years. This means that you would not have to file your tax returns. A discharge will not lift your tax liability during the time it takes to repay the amount discharged, so you should not attempt to get a discharge unless you are very sure that you will not be in a position to repay the amount discharged.

 

When you file for discharge, you may also not need to worry about future credit score damages. In many cases, a discharge will increase your credit score and will allow you to apply for loans and mortgages in the future. In addition, discharged debts will be included on your personal record, so landlords and employers will not turn down your application for housing and employment.

 

Many people don’t think of filing bankruptcy as a debt relief option because they believe it will affect their credit score and their ability to purchase property in the future. However, filing bankruptcy should not be thought of as a negative thing. In fact, a bankruptcy filing can be an opportunity to start over. With careful planning and a determined plan to get out of debt, you can be on the road to financial freedom again. In addition, many people feel that a bankruptcy filing will mark the end of their financial situation and they will never be allowed to file again.

This is simply not true. The bankruptcy protection laws were designed to provide you with peace of mind. If you follow the rules and procedures outlined by your bankruptcy lawyer, you can be almost certain that your credit record will not be negatively affected by this action. In fact, bankruptcy protection can be a positive event that can help you repair your financial situation. Filing for chapter 7 bankruptcy is a decision that can change your life – for the better!