Do I Have To List My Business Assets on My Personal Bankruptcy?

This is an excellent question.  For the most part, our bankruptcy clients who have businesses fall into two categories. The first category consists of those who feel as though they and their business are “one” entity. The second category consists of those who feel as though their business is a completely separate entity. Often, when clients drop their paperwork off at our office and we question what business assets exist, clients will reply, “Well, that doesn’t belong to me, that belongs to my business.”  So the real question is: what needs to be listed as assets in your bankruptcy and what does not?

Technically, ALL of your assets need to be listed.  Therefore, going back to our previous blog post on whether or not tools are protected we can examine debtor-owned businesses based upon the same scenarios.  Let’s use the example of Joe Blow’s Lawn Care.  Joe owns Joe Blow’s Lawn Care.  The lawn mower, rakes, blower, hedgers, etc. all belong to Joe. If he decided to no longer run the company next week, the only difference would be that the tools would move from his truck to his garage at home. These tools would need to be listed in Joe’s personal property and protected by the exemption known as “Tools of the Trade” as long as Joe is using them in his business. If Joe were to be sued, he would need to protect those tools as he would any other asset (such as a bank account or vehicle) he has from seizure.

Referring back to the same situation as discussed in the previous blog post, let’s use the scenario that Joe went to the Secretary of State and registered his company as a corporation.  Now Joe Blow’s Lawn Care, Inc. is the owner of the tools.  Even though the company at this point in time owns the tools, let us not forget that in the end scheme of things the debtor owns the company.  That company is an asset in itself; therefore the tools would be listed on the business balance sheet, included as an asset and the Joe’s portion of equity from the corporation must be listed in the bankruptcy and protected.

Regardless of how large or small, the court looks as personal assets all in the same; they need to be listed and at least attempted to be protected in the bankruptcy.  Again, it goes back to the confusing question of how the business should be treated for bankruptcy purposes.  Since businesses can get quite complicated at times, we strongly suggest that you thoroughly discuss your business and any other assets you or your business may have with your attorney so they may advise you properly to ensure your assets are protected.

What Happens After My Free Bankruptcy Consultation?

After your free bankruptcy consultation, you may choose to sign a contract.  We will thoroughly explain each section of the contract, answer any other questions that you may have and allow you as much time as necessary to review our work agreement.  At this time we can set you up on an easy payment plan, which allows you to give us an estimate of a time frame of when you expect to file and allows you to make payments toward the attorney fees.

We will then give you your paperwork, along with an example of the paperwork as a quick reference guide.  We will explain in detail the documents needed to file, and the process of turning them in.  Lastly, you’ll get an email contact of someone in the office should you have any further questions.  No matter what, we want you to be as informed as possible and we want this process to be smooth and efficient for you!

In other words, you choose what the next steps are after your consultation.  You may choose to file bankruptcy with our law firm or you may wish to think about some of your options.  Again, we are here to answer questions as they come about.  We hope we get the opportunity to earn your business and we look forward to working with you. Contact us to get your fresh financial start today!

Important Issues When Completing Your Bankruptcy Paperwork

The foundation of your bankruptcy starts with your paperwork.  We find it easier to gather all of your documents and then start to fill out your workbook.  When gathering all of your documents, make sure that they are all there.  We would rather receive too much information than not enough.  The documents themselves determine quite a few things in your bankruptcy- your pay determines whether you qualify for a Chapter 7 bankruptcy or not;  or how much you can pay back in a Chapter 13 bankruptcy.  Papers from the purchase of vehicles show whether or not to pay the car back in full or at the value of the vehicle.  These all have an impact on your bankruptcy plan.  Sometimes one piece of paper can save you several hundred dollars in your Chapter 13 plan  (well worth the effort of gathering them!).

Make sure that you list anything and everything that is in your possession, especially if there is a papertrail to it; we will try to protect everything that you have.  Leaving things out only hurts you in the future.  You definitely do not want to be called to court because you were trying to keep a possession hidden.   List all creditors’ account numbers and addresses; if they cannot locate your account, it may not be taken care of.  Above all, just make sure to fill out the workbook completely; if it is not filled out, we will ask for the answer either way,  it makes it less work for you if it is done correctly in the first place.