Understanding Bankruptcy, Apr. 30, 2020

Filed under: Latest News |

BY MICHAEL A. CIBIK, ESQ.
AMERICAN BANKRUPTCY BOARD CERTIFIED

Question: How can bankruptcy save my small business?

Answer: Last year, before COVID-19 even existed, Congress added a fifth subchapter to Chapter 11 of the bankruptcy code that could very well help many small businesses survive the major damage caused by the pandemic.

When faced with bankruptcy, small businesses usually had two options – either file a costly and complicated Chapter 11 to try and stay in business, or file a Chapter 7 liquidation and close up shop. Because Chapter 11 was designed with big business in mind, smaller businesses were deprived of the reorganizational benefits it can offer.

Subchapter 5 allows small businesses to file for bankruptcy under Chapter 11 without the red tape that only big business can afford. Instead of having to close up shop and file a Chapter 7, small businesses can file under Chapter 11 to reorganize their debt and stay afloat.

If you need help keeping your business in business, please call or text me at (215) 735-1060 or go to philadelphiabankruptcylawyers.com

Michael A. Cibik, Esquire
www.ccpclaw.com
ccpc@ccpclaw.com
215-735-1060

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