I have just began talking with my lawyer about bankruptcy.
A quick nutshell: i have years of bad debts/credit cards that has trashed my credit and finally became so un-manageable that I had to do something. We receive a hundred calls each day from creditors.
Our credit cards (in our name) are doubled over limits with no reasonable settlements. Here is where it gets tricky: I had my accountant file papers at the end of last year for us to be a corporation. The business is officially an S corp with me as the sole member. We have not hit our full fiscal tax year so we have not filed taxes as of yet. and to be honest- we will show a loss.
Being that we are an S corp, there are many questionable charges such as too many business lunches, gifts to customers etc. on the business check book (i may be able to justify them, but I want to know the worse case scenario). I am aware that if we only did a business bankruptcy, the judge could rule that the corporation is 'spoiled' (help me if that is not the correct term here). By spoiled I mean that we have filed as an S corp, but have actually ran it as a sole proprieter.
We have so many personal debts which likely outweight the business debts (so ultimately the debts could fall back on me personally). The business debts may also be directly tied to me..such as a freight bill that has both my name and the corps name on the account (they requested my soc when opening the account).
Here are the questions:
1.) if the corporation is spoilel... am I personally liable for the business debts?
2.) if i am liable for the business debts- because the corp is spoiled, can I include them in my personal bankruptcy?
2a) can my personal bankruptcy absorb all business debts when filed? Meaning, if I file personal bankruptcy and include all debts business and personal, can any future lawsuit for those debts be filed if they are includes in the bankruptcy?
3.) the business assets are minimal, and some do not have good records (cash transaction for a $800 forklift, or carryover from personal ownership). They may total $3000 for all assets. I could use a paycheck that we have not had in 3 months. Should I sell the assets now, or wait until bankruptcy begins?
please note that even if we include the $3000 business assets into our personal assets- it will likely not total $10,000 for TOTAL assets owned.
I know the questions are confusing, - but I don't know where to start.
Thanks in advance.
A quick nutshell: i have years of bad debts/credit cards that has trashed my credit and finally became so un-manageable that I had to do something. We receive a hundred calls each day from creditors.
Our credit cards (in our name) are doubled over limits with no reasonable settlements. Here is where it gets tricky: I had my accountant file papers at the end of last year for us to be a corporation. The business is officially an S corp with me as the sole member. We have not hit our full fiscal tax year so we have not filed taxes as of yet. and to be honest- we will show a loss.
Being that we are an S corp, there are many questionable charges such as too many business lunches, gifts to customers etc. on the business check book (i may be able to justify them, but I want to know the worse case scenario). I am aware that if we only did a business bankruptcy, the judge could rule that the corporation is 'spoiled' (help me if that is not the correct term here). By spoiled I mean that we have filed as an S corp, but have actually ran it as a sole proprieter.
We have so many personal debts which likely outweight the business debts (so ultimately the debts could fall back on me personally). The business debts may also be directly tied to me..such as a freight bill that has both my name and the corps name on the account (they requested my soc when opening the account).
Here are the questions:
1.) if the corporation is spoilel... am I personally liable for the business debts?
2.) if i am liable for the business debts- because the corp is spoiled, can I include them in my personal bankruptcy?
2a) can my personal bankruptcy absorb all business debts when filed? Meaning, if I file personal bankruptcy and include all debts business and personal, can any future lawsuit for those debts be filed if they are includes in the bankruptcy?
3.) the business assets are minimal, and some do not have good records (cash transaction for a $800 forklift, or carryover from personal ownership). They may total $3000 for all assets. I could use a paycheck that we have not had in 3 months. Should I sell the assets now, or wait until bankruptcy begins?
please note that even if we include the $3000 business assets into our personal assets- it will likely not total $10,000 for TOTAL assets owned.
I know the questions are confusing, - but I don't know where to start.
Thanks in advance.