Business bankruptcy · Beverly Hills
Business Bankruptcy in Beverly Hills With Your Personal Guarantees Reviewed
Business bankruptcy in Beverly Hills helps owners close a failing business in an orderly way or reorganize one that can still make it. If creditors are calling you personally about business debts, call (310) 362-9071 for a free consultation. We look at the business and your personal exposure together.
- Chapter 7 to close the business
- Subchapter V to reorganize and keep going
- A personal case for guarantees and owner debts
- Sometimes, no bankruptcy at all
Signs it is time to talk about business bankruptcy
- Revenue no longer covers rent, payroll and loan payments
- A landlord has served a notice or filed an eviction
- A lender or merchant cash advance company is debiting your accounts or suing
- You signed personal guarantees on leases, credit lines or SBA loans
- Payroll or sales taxes are behind
How the business structure changes the answer
Sole proprietor
The business and the owner are the same in the eyes of the law. Business debts are handled in your personal Chapter 7 or Chapter 13 case.
LLC or corporation closing
The company can file Chapter 7. A trustee sells its assets and pays creditors. The company does not get a discharge, but the case gives an orderly end.
LLC or corporation staying open
The company can reorganize under Chapter 11 / Subchapter V and keep operating under a plan.
How we handle a business bankruptcy, step by step
- Free consultation. We review the business's debts, assets, leases, tax filings and every personal guarantee you signed.
- Pick the path. We decide whether the business should close, reorganize or settle outside bankruptcy, and whether you need a personal case too.
- Protect what you can. Before filing, we review recent transfers, payments to insiders and use of business funds, because the trustee will.
- File the case or cases. We file the business case, a personal case, or both, in the right order.
- See it through. We handle the 341 meeting, trustee requests and any creditor challenges until the case closes.
Cost and timeline
Business cases vary widely. A simple Chapter 7 for a closed company costs far less than a reorganization. You get our fee in writing at the free consultation after we see the business's records.
A Chapter 7 for a closed business often finishes within several months, depending on how many assets the trustee has to sell. A reorganization runs 3 to 5 years under the plan.
Business cases in Los Angeles
Business bankruptcies from Beverly Hills and most of Los Angeles County are filed in the Los Angeles Division of the U.S. Bankruptcy Court, Central District of California, at 255 East Temple Street. An LLC or corporation cannot represent itself in bankruptcy court and must have a lawyer, while an individual owner can file a personal case on their own, though most should not.
Withheld payroll taxes and collected sales taxes deserve special attention in California. The IRS and the state can hold the people responsible for them personally liable, even if the company closes. We look at those first.
Mistakes owners make
- Paying yourself back first. Repaying owner loans shortly before filing can be undone by the trustee.
- Selling equipment cheaply to a friend. Below-value sales are often reversed.
- Walking away from the company. An abandoned business still has tax and lease obligations, and guarantees still follow you.
- Assuming the LLC protects you. Guarantees and trust fund taxes cut through that protection.
Related services
If the company can keep going, read about Chapter 11 / Subchapter V small business bankruptcy. For a personal case to deal with guarantees, see Chapter 7 bankruptcy in Beverly Hills.
Business bankruptcy questions
Am I personally liable for my business's debts?
You are personally liable for business debts you guaranteed, and for some taxes, even if the business is an LLC or corporation. Debts you did not guarantee usually stay with the company. We go through each debt to see which ones follow you.
Can my LLC file Chapter 7?
Yes, an LLC can file Chapter 7. A trustee will collect and sell its assets and pay creditors. The LLC does not receive a discharge, so Chapter 7 is used to close a company, not to save it.
Do I need to file personally too?
You may need to file personally if you guaranteed business debts or owe trust fund taxes. If you did not, the business case may be enough. We decide this at the consultation.
Can I start a new business after bankruptcy?
Yes, you can start a new business after bankruptcy. There is no law that bars you from owning a business after filing. We explain how to keep the new business separate from the old one.
Free consultation
Sort out the business and your personal exposure
Call (310) 362-9071 or send the form. Bring a list of business debts and any guarantees you signed.
Law Offices of John Asuncion9454 Wilshire Blvd., Penthouse Floor
Beverly Hills, CA 90212
(310) 362-9071
Monday to Friday, 9 a.m. to 6 p.m.