Rockland County, NY Chapter 5 Bankruptcy Attorney

New York small business bankruptcy attorney subchapter V

Lawyer Assisting Small Businesses With Bankruptcy and Reorganization in the Hudson Valley Area

Businesses struggling with debt have traditionally had two options for pursuing bankruptcy, and in some cases, neither of these options is viable. Since a Chapter 7 bankruptcy requires a business to liquidate its assets to repay creditors, most businesses wish to avoid this option, but many small businesses struggle to complete the requirements of a Chapter 11 bankruptcy. The Small Business Reorganization Act of 2019 has provided businesses with another option by creating a new form of bankruptcy under Subchapter V of Chapter 11. When pursuing a Chapter 5 bankruptcy, a business will want to work with an attorney who has a full understanding of the requirements and procedures followed under this new law.

The Law Offices of Robert S. Lewis, P.C. has assisted hundreds of businesses and individuals in filing for bankruptcy. With over 35 years of legal experience and an understanding of how the bankruptcy laws apply in your case, Attorney Robert Lewis can assist your business with addressing its debts and meeting the requirements for reorganization. He will work with you to complete the bankruptcy process successfully and ensure that your business is prepared for success.

Benefits of Chapter 5 Bankruptcy

A Chapter 5 bankruptcy is available for businesses that are considered “small business debtors,” meaning that their total unsecured debts are under a certain threshold. It is meant to simplify and streamline the reorganization process for these businesses in the following ways:

  • As with a Chapter 11 bankruptcy, debtor-in-possession rules will be followed, allowing a business owner to remain in possession of business assets and continue operating the business. However, rather than having the debtor serve as trustee, a trustee will be appointed who will assist in the reorganization process and disburse payments to creditors.
  • Unlike a Chapter 11 bankruptcy, a committee of creditors will not be appointed unless the bankruptcy court believes there is good cause to do so. This will help reduce costs for the debtor by eliminating the fees and expenses related to the professionals who serve on this committee.
  • The debtor will submit a reorganization plan within 90 days of filing a petition for bankruptcy. Creditors will not be able to submit their own plans. The debtor’s plan will detail how debts will be paid over a period of three to five years. In most cases, a debtor’s plan will be approved, even if creditors object, as long as it is feasible and fair and equitable to creditors, and it provides that all disposable income earned by the business will be used to make payments under the plan.
  • Debtors will generally not be required to file a complete disclosure statement as they would be required to do in a Chapter 11 bankruptcy. Instead, the reorganization plan will include some of the information that would be addressed in a disclosure statement, including a history of the company’s operations, an analysis of the proceeds that could be received from liquidating the business’s assets, and a financial projection that shows that the business will be able to make payments to creditors under the proposed plan.

Contact Our Orangetown Chapter 5 Bankruptcy Lawyer

If your small business is struggling to repay debts, you may be unsure about your options, and you may be concerned about your ability to continue operating your business after filing for bankruptcy. Fortunately, the new options for Chapter 5 bankruptcy may allow you to complete the process of reorganization and put a plan in place for repaying your debts while maintaining ongoing business operations. Attorney Robert Lewis can help you understand whether Chapter 5 bankruptcy is right for you, and he will work with you to complete the bankruptcy process successfully. To schedule a free consultation, contact our office today at 845-358-7100. Se Habla Español.