Bk LLC, personal, or both?

[bksick]

[downrollings]

is it a hybrid business entity having certain characteristics of both a corporation and a partnership or sole proprietorship?????
pls let me know about this.....

[bksick]

Hi downrollings,
Thanks for the reply. I am unsure of what you are asking. We have the business setup as an LLC. Can you please explain a little more and I will get back to you right away. Thanks for trying to help!

[fireworks]

Some of this will be state-specific. You'll want to discuss with a bankruptcy attorney to be sure.

However, I was in a very similar position and I'm sure the laws are similar. My attorney advised me that under Texas law, if the LLC has any assets (inventory, equipment, etc), the court will want to seize those assets in order to satisfy your debts. My attorney's advice was to close my store and sell all of the assets. I had a going-out-of-business sale and got rid of all of my inventory and most of my assets so that I could spend the money as I chose rather than letting the court choose - I paid off my back taxes and used that money for living expenses while I was looking for a new job.

I have a second business which has always been a side job for me when the store was slow. That business has no hard assets other than a laptop and printer, it's a service business based completely on knowledge and skills that I have. The computer hardware isn't worth enough for the court to worry with.

If your equipment is the only asset you have, you might be able to exempt it as "tools of trade." When you look at that, remember that you should value the equipment at what it would sell for (think ebay or pawn shop) rather than what you paid for it. Since you still owe on the other equipment I suspect it would be treated like a car, meaning its value for this purpose is the resale value less what you owe.

Your situation is complicated - you really need a competent attorney to work you through this.

@downrollings - yes, an LLC is a business entity that has some properties of a corporation and some of a sole proprietorship. You'll find lots of info in a Google search.