Bankruptcy does not get rid of all debts. You are still responsible for:
- Alimony
- Child support
- Most recent back taxes
- Most student loans
- Recent large purchases of more than $550 for luxury goods bought within 90 days of filing
- Fines or penalties of government agencies
- Fraudulent debts
- Cash advances of $825 within 70 days of filing
On April 20, 2005, the President signed into law the Bankruptcy Abuse Prevention and Consumer Protection Act, which limits individual access to US bankruptcy courts. Some of the changes, which were effective October 17, 2005, included:
- New bans on Chapter 7
- Increased Chapter 13 payments
- New presumptions against debtors with increased penalties
- The reduction of judicial discretion to balance competing interests
Chapter 11 Bankruptcy
A reorganization under Chapter 11 bankruptcy provides mutual benefits for both a business and its creditors. The business benefits because it receives an opportunity to continue operating and remain a viable concern. . The creditors benefit because they often receive a greater overall payment than they would under a straight liquidation of the business’ assets.
The Chapter 11 bankruptcy attorneys at Cupps & Garrison can effectively evaluate and advise you on your business’ financial situation and advise you if Chapter 11 will work best for your business. We work closely with financial experts to help develop a debt restructuring plan that can relieve your company's burdensome debt.
Although every case is different, you may be able to avoid liquidation if your plan is carefully crafted by an experienced bankruptcy law attorney. Having a bankruptcy lawyer guide you through the process and advise you concerning your rights is an important first step.