Chapter 7 - Orderly Liquidation of a Business - Parry Tyndall White
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Chapter 7 – Orderly Liquidation of a Business

It is not usually necessary for a business that is winding down to file bankruptcy.  But sometimes, Chapter 7 can bring order to the chaos of closing a business down.

 

When you file for Chapter 7, the bankruptcy “automatic stay” immediately protects you from your creditors. In exchange for that protection you agree to allow the bankruptcy trustee to liquidate all non-exempt assets in order to pay those creditors. This effectively ends your small business, but can give you the ability to move forward with a new entity.  It allows for an orderly liquidation, and is sometimes the best way for a business to wind down.