Friend of mine is getting ready to file chapter 7 and is 1/3 owner of a business. Value of the business is unknown because he is no longer working there or recieving revenue of any type for the last 8 months, but still owns 1/3 of the business. Business is retail with inventory. Other two owners contacted him recently and offered a specific sum to buy his 1/3 so they can get new loans to help run the business, his credit score has not allowed them to secure loans. Bottom line on this is they forced him out of the business but he has the 1/3 legal ownership. When files he chapter 7 under the current situation the business will be listed as an asset on his petition which will turn his chapter 7 into an asset case and the trustee will investigate the business for value to recover. If he sells the business before filing and uses the proceeds on living expenses his case would be a non-asset case.
Does this scenario seem correct as I stated it?
Opinions and responses greatly appreciated.
Does this scenario seem correct as I stated it?
Opinions and responses greatly appreciated.
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