How to Continue an LLC Business After Bankruptcy

If you are an owner or partial owner of a limited-liability company, or LLC, facing serious financial issues, you may contemplate filing for bankruptcy. With bankruptcy your best or even only option, a prime concern for you may be whether it is possible to continue your business at the conclusion of your bankruptcy case. Desiring to continue your business after pursuing a bankruptcy, you need to file what is known as a Chapter 11 bankruptcy.

Things You'll Need

• Petition for Chapter 11 bankruptcy

Instructions

1. Obtain a petition for a Chapter 11 bankruptcy. Through a Chapter 11 bankruptcy, a business continues operation, including a LLC. The LLC is provided the opportunity to reorganize its operations and restructure its debt under bankruptcy court protection and supervision.

2. Complete the Chapter 11 bankruptcy petition. The bankruptcy court clerk provides detailed instructions on how to complete the form. Make certain you fill out all spaces on the form. If something does not apply, write "N/A" or "none." If you leave anything blank, you run the risk of the bankruptcy court returning your paperwork to you and dismissing your case.

3. Create a business reorganization and debt restructuring plan under the guidance of the bankruptcy court trustee. The bankruptcy court trustee is the court official responsible for overseeing your case on a day-to-day basis. The trustee provides forms and informational resources to assist with this process.

4. Execute both your business operational reorganization and debt restructuring plan.

5. Obtain a final order of discharge from the bankruptcy court following completing of the reorganization and restructuring plans.

Tips & Warnings

• A Chapter 11 bankruptcy is a complicated legal process. Consider engaging the services of a qualified and experienced attorney to represent you. The local and state bar associations in your jurisdiction maintain directories of attorneys in different practice areas, including commercial bankruptcy. Contact information for these organizations is available through the American Bar Association:

• American Bar Association

• 321 N. Clark St.

• Chicago, IL 60654-7598

• 312-988-5000

• abanet.org

References

• Cornell Law School: U.S. Bankruptcy Code
• "The Glannon Guide to Bankruptcy"; Nathalie Martin; 2006
• Cornell Law School: Bankruptcy Overview

Resources

• American Bar Association: Bankruptcy & Insolvency Litigation Committee
• U.S. Bankruptcy Court: Filing for Bankruptcy without an Attorney
• U.S. Courts: Bankruptcy Forms
• American Bar Association: Directory of State and Local Bar Associations