In today’s economy, many people in New Jersey are starting their own companies as a way to make money. However, the endeavor of being a small business owner can be an enormous challenge. It could take some time before a company starts to generate a significant profit, if the company makes a profit at all. Unfortunately, many small business owners must face the possibility of filing for bankruptcy.
Many small business owners put everything they have into making a business venture a success. Unfortunately, many people end up losing all of it if a company is not profitable. Recently, the founder of a small brewery filed for Chapter 7 bankruptcy about a month after his brewery was taken into corporate bankruptcy. According to reports, the man started his business inside his own home and it grew slowly but surely over the course of 17 years. But management issues put the company’s success in jeopardy and financial issues plagued the man and his company.
In his personal Chapter 7 bankruptcy petition, the man noted that he had fewer than $40 in a checking account, $200 in a PayPal account, $300 worth of clothing and empty kegs worth about $10 each. None of this is sufficient to meet his financial obligations of about $8.2 million to about 370 creditors. Among others, he owes tax debts in the amount of $865,000 to government entities and another $3 million to his parents.
By filing for Chapter 7 bankruptcy, the man can have his unsecured debts, which includes credit card debt, discharged. As opposed to other types of bankruptcy, Chapter 7 offers people a solution that often takes less than six months. There is no need to develop a repayment plan or reorganize debts. This can be a good way of cleaning the slate and making a fresh financial start without all the burdens of debt.
Source: LSJ.com, “Michigan Brewing Co. founder files for personal bankruptcy,” Steven R. Reed, March 7, 2013
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