Can I combine personal and business debt if filing bankruptcy? 18 Answers as of February 12, 2011

My business has accumulated $55,000 a year for the past 2 years. I want to terminate the LLC. I also have about $20,000 in personal debt. Can I include my business debt if I file for bankruptcy? Thank you in advance.

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Law Offices of Michael J. Berger
Law Offices of Michael J. Berger | Michael J. Berger
A Husband and a Wife can file a joint bankruptcy together, but an LLC and an individual can not file a joint bankruptcy together. That would be 2 separate cases. If you are filing bankruptcy as an individual and you are concerned that creditors of the LLC may come after you, you should list the LLC debt in your bankruptcy.
Answer Applies to: California
Replied: 2/12/2011
Gus Johnson Attorney at Law
Gus Johnson Attorney at Law | Gus Johnson
debt incurred by a corporation is not discharged by a personal bankruptcy, but you can discharge any personal guarantees you made on the corporation's debt.
Answer Applies to: South Dakota
Replied: 2/1/2011
Law Office of Larry Webb
Law Office of Larry Webb | Larry Webb
Yes, but the assets of the business may be subject to levy by the creditor. If your business debt is greater than your personal debt, that may help you as to the means test. Consult with an attorney.
Answer Applies to: California
Replied: 1/31/2011
Mankus & Marchan, LTD
Mankus & Marchan, LTD | Tony Mankus
If you file bankruptcy personally, you shoul not include any debts of the LLC, unless you guaranteed them personally.
Answer Applies to: Illinois
Replied: 1/31/2011
William C. Gosnell, Attorney at Law
William C. Gosnell, Attorney at Law | William C. Gosnell
No you must file corporate 7 and a personal 7.
Answer Applies to: Tennessee
Replied: 1/29/2011
    DiManna Law Office, LLC.
    DiManna Law Office, LLC. | Dawn DiManna
    You would file a business and an individual bankruptcy.
    Answer Applies to: New Hampshire
    Replied: 1/28/2011
    The Law Office of Mark J. Markus
    The Law Office of Mark J. Markus | Mark Markus
    You have to include any debt your are or may be liable for. So, to the extent you have personal guarantees or other liability on the debts the LLC, you must include them in your personal bankruptcy case.
    Answer Applies to: California
    Replied: 1/28/2011
    Carballo Law Offices
    Carballo Law Offices | Tony E. Carballo
    You might want to dissolve the LLC first and assume its debts (take personal liability for the debts of the LLC) and then list all the debts, both personal and assumed from the LLC, in your personal bankruptcy case. This requires the assistance of a highly experienced local bankruptcy attorney and not just one of those attorneys new to bankruptcy who handle high volume credit card bankruptcy cases for a minimal fee.
    Answer Applies to: California
    Replied: 1/28/2011
    Ursula G. Barrios Law
    Ursula G. Barrios Law | Guillermo Machado
    You can file one bankruptcy and combine both business and personal debt. If the majority of your debt is business debt, you won't need to pass the means test.
    Answer Applies to: California
    Replied: 1/28/2011
    Judith A. Runyon, Esq. Attorney at Law
    Judith A. Runyon, Esq. Attorney at Law | Judith A. Runyon
    Yes, you can combine both types of debt.
    Answer Applies to: California
    Replied: 1/28/2011
    Steven D. Keist, Attorney at Law
    Steven D. Keist, Attorney at Law | Steven D. Keist
    Yes as long as you no longer operate the business.
    Answer Applies to: Arizona
    Replied: 1/28/2011
    Law Office of David P. Farrell
    Law Office of David P. Farrell | David Farrell
    To the extent you are personally liable on the "business debt" it should be included in your bankruptcy petition. Lenders commonly require business owners to personally guarantee business loans so that in the event of default the lender can look to the owner, and not just the business, for repayment. If this is the case and you file personal bankruptcy and receive a discharge you will no longer be personally liable for the debt. However, the limited liability company, which is legally treated as a separate entity, will remain so. You should consult with an attorney about your situation.
    Answer Applies to: California
    Replied: 1/28/2011
    Uriarte & Wood, Attorneys at Law
    Uriarte & Wood, Attorneys at Law | Robert G. Uriarte
    your business is a separate entity if it is an LLC, however to the extent you have guaranteed the business' liabilities, you can list such obligations in your personal bankruptcy and discharge the personal liability. You really need to sit down with a lawyer and review the entire situation to ascertain how best to proceed.
    Answer Applies to: California
    Replied: 1/28/2011
    The Law Office of Brian Nomi
    The Law Office of Brian Nomi | Brian H. Nomi
    Any debt can be part of a bankruptcy, and wiped out by the bankruptcy. Some debts are non-dischargeable (taxes, student loans, and a few others).
    Answer Applies to: California
    Replied: 1/28/2011
    Greifendorff Law Offices, PC
    Greifendorff Law Offices, PC | Christine Wilton
    If you personally guaranteed the business debt, then yes. Otherwise, no.
    Answer Applies to: California
    Replied: 1/28/2011
    Janet A. Lawson Bankruptcy Attorney
    Janet A. Lawson Bankruptcy Attorney | Janet Lawson
    You can include in your bankruptcy and debt your are obligated to pay. Filing a bankruptcy for the LLC is one way to lay it to rest, (and avoid future state tax ).
    Answer Applies to: California
    Replied: 1/28/2011
    The Orantes Law Firm
    The Orantes Law Firm | Giovanni Orantes
    It may be possible to discharge your personal debt as well as the debt of your business legal entity, but you need an experienced bankruptcy attorney as well as a tax advisor to do it so that you do not incur liabilities that could have been avoided if done properly. Consult someone as soon as possible to try to have as long as possible to take the steps necessary to discharge the debt in the most advantageous way. Filing a bankruptcy without proper planning, especially when the debtor has a business, can be like stepping onto a landmine field.
    Answer Applies to: California
    Replied: 1/28/2011
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