Entendiendo el Capítulo 13 de Bancarrota para Propietarios de Pequeñas Empresas: Ventajas, inconvenientes y explicación del proceso

As a small business owner, it’s common to face financial difficulties that may lead to considering bankruptcy. In particular, Chapter 13 bankruptcy can be an option for those who want to reorganize their debts and keep their business running. But how exactly does it work, and what are the implications for small business owners? Let’s dive in and explore this topic in detail.

¿Qué es el Capítulo 13 de la Ley de Quiebra?

Chapter 13 bankruptcy, also known as a wage earner’s plan, is a form of debt reorganization that allows individuals with a regular income to develop a plan to repay all or part of their debts. Under this chapter, debtors propose a repayment plan to make installments to creditors over three to five years.

Eligibility for Chapter 13 Bankruptcy

To be eligible for Chapter 13 bankruptcy, a debtor must have a regular source of income and meet certain debt limitations. As of 2023, your unsecured debts must be less than $2,750,000 when filing.

Advantages of Chapter 13 Bankruptcy for Small Business Owners

For small business owners, Chapter 13 bankruptcy can provide several benefits, such as:

1. Protection from creditors through the automatic stay, which stops collection actions and lawsuits.
2. The ability to retain assets, like a home or car, by incorporating them into the repayment plan.

Disadvantages of Chapter 13 Bankruptcy for Small Business Owners

Chapter 13 bankruptcy protections only apply to the individual filing, not the individual’s small business. You should evaluate Chapter 11 if you are seeking to obtain legal protection from creditors regarding a business.

The Chapter 13 Bankruptcy Process

The process for filing Chapter 13 bankruptcy involves several steps:

Presentación de la petición

The debtor must file a petition with the bankruptcy court in their jurisdiction, along with schedules detailing their financial affairs. This includes information about income, assets, liabilities, and more.

The Repayment Plan

Debtors must submit a proposed repayment plan outlining how they will repay their debts over three to five years. The plan allocates payments to priority debts, like taxes, and secured debts, like mortgages, before addressing unsecured debts.

The Confirmation Hearing

A bankruptcy judge will review the proposed repayment plan during a confirmation hearing. Creditors may object to the plan, and the judge will determine whether it is fair and feasible.

Making Plan Payments

Once the repayment plan is confirmed or payments are otherwise vested, the trustee will distribute these payments to creditors according to the plan’s terms.

Condonación de deudas

Upon completion of the repayment plan, the debtor will receive a discharge of their remaining unsecured debts. This means they are no longer legally obligated to pay these debts, and creditors cannot attempt to collect them. You must comply with all bankruptcy requirements, including completing the post filing Financial Education Course, to be eligible to receive a discharge.

Chapter 13 Bankruptcy vs. Chapter 7 and Chapter 11

There are other types of bankruptcy that small business owners might consider, such as Chapter 7 and Chapter 11. Here’s how they differ from Chapter 13:

Quiebra del Capítulo 7

Chapter 7 bankruptcy involves liquidating the debtor’s non-exempt assets to pay off debts. It is typically used by individuals or businesses with little to no chance of repaying their debts. While it can provide a fresh start, it may also result in the closure of the business and the loss of assets.

Quiebra del Capítulo 11

Quiebra del capítulo 11 is designed for businesses and allows them to reorganize and renegotiate debts while continuing to operate. This type of bankruptcy is more complex and costly than Chapter 13 but can be suitable for larger businesses with substantial debts.

Small businesses may benefit from the newly enacted Subchapter V business reorganization. It is a simplified and less expensive form of Chapter 11. You should discuss this option with a business bankruptcy attorney to see your options.

Impact of Chapter 13 Bankruptcy on Small Business Operations

Filing for Chapter 13 bankruptcy can affect small business operations in several ways:

Financial Management

The debtor must adhere to a strict budget during the repayment plan period, which can limit their ability to invest in their business or take on new debts. Additionally, they may need to consult the bankruptcy trustee before making significant financial decisions.

Credit Implications

Chapter 13 bankruptcy remains on the debtor’s credit report for seven years, making obtaining new loans or lines of credit more challenging. This can limit the business’s growth potential and may require the owner to seek alternative funding sources.

Conclusión

Chapter 13 bankruptcy can be a viable option for small business owners struggling with debt and wanting to keep their businesses running. By understanding the process, eligibility requirements, and potential impacts on business operations, owners can decide whether Chapter 13 is the right choice for them.

Preguntas frecuentes

1. Can a small business file for Chapter 13 bankruptcy?

No, a small business may not file for Chapter 13 as it is only available for individual filers with regular income with total debts not exceeding $2,750,000. A small business seeking to reorganize its debts may file for Chapter 11 or Chapter 11 Subchapter 5. A small business seeking to wind down operations may look into filing Chapter 7 to liquidate its assets. 

2. How long does a Chapter 13 bankruptcy repayment plan last?

A Chapter 13 bankruptcy repayment plan typically lasts for three to five years, depending on the debtor’s income and debt amount.

3. Will I lose my business assets in a Chapter 13 bankruptcy?

In most cases, small business owners can keep their assets during a Chapter 13 bankruptcy by incorporating them into the repayment plan.

4. Can I continue to operate my business during Chapter 13 bankruptcy?

Yes, small business owners can continue to operate during Chapter 13 bankruptcy as long as they comply with the terms of their repayment plan and any additional requirements set by the bankruptcy court.

5. How does Chapter 13 bankruptcy affect my credit?

Quiebra del capítulo 13 remains on your credit report for seven years, which can make it more challenging to obtain new loans or lines of credit.

Robert Stiberman es un abogado especializado en quiebras con amplia experiencia en Quiebra del capítulo 13 casos. Ha representado a numerosos clientes en casos de quiebra y está bien versado en los requisitos de los fideicomisarios del Capítulo 13. Con su conocimiento y experiencia, Robert Stiberman puede proporcionar a sus clientes con la orientación y la representación que necesitan para navegar con éxito la bancarrota.