Please ! Please give me your thoughts

[mustang]

I am in deep, very deep trouble.

I bought an existing business last year
financing by my own savings, credit cards
and other sources.

The business owner let me sign a promissory note
to buy it.

Business was not good then was closed.

The former business hads suited me and put judgements
on myself and the 'S" corp of mine.

There is no way out, but go bankrupt.

Chapter 7 ( personal bankrupt)
will wipe out all credit card debts and personal
judgements.


What is about the "S" corporation which I own 100%
its shares.

It is the "S" corp, the shareholder report income and loss on
their own individual incom tax returns.

My question is...besides the personal bankruptcy
Chapter 7, what else should I do to discharge the
debts and judgement against "S" Corporation under my name.

I do not intent to use this "S" corp any more.
There is no assets, but debts and judgements. In the future
if I want to do business will create a new corporation and take
a different name.



Please give me you thoughts.

[rfassett]

Talk to a lawyer that deals with Corporate bankruptcy. You don't say what assets are in the Corp, but you can also do a Chapter 7 for the Corp. As was discussed in a different thread, there is no such thing as a Chapter 7 discharge for a Corp. What happens is that all assets are sold, creditors, trustees and lawyers (not in that order) are paid out of the proceeds, and the rest just go away with the dissolution of the Corp. If you have guaranteed debts, the guarantees can be discharged on your personal Chapter 7. If you had payroll in the Corp and you owe trust fund taxes, those will be assessed against you personally. If you are unable to pay them, they will not be discharged in your personal Chapter 7 so you may need to do what another party on this forum is doing, a Chapter 20, which is simply a Chapter 7 followed by a Chapter 13 after the 7 is discharged. This will give you some time to pay off the priority debt (trust fund taxes, etc.). Hope this helps. Talk to an attorney and study what you can find and use this forum - it has the best advice from the most compassionate people that you will find. By and large, we have all been there, done that - or are there now. Good luck!

[halomom]

Mustang,

I've just been in a similar situation this year as an S corp wholly owned by me. Since I was the sole owner and had personally guaranteed everything (corporate franchise agreement, lease of business site, last phone bill, etc) it was all included on my Chapter 7. I sold/donated almost all the business equipment before filing. There was some large equipment that was difficult to sell and the trustee took it. I actually didn't mind because I was paying to store it and no one wanted to buy it from me anyway.

I know how hard it is to not only have have your personal financial life in disarray, but to lose the dream of being your own boss. I closed for business the end of September, filed the end of November and got my discharge a week ago today. I tell you this to let you know that there is a light at the end of the ordeal! Hang in there!