Morristown Subchapter V of Chapter 11 Bankruptcy Attorneys
Many small business owners may face the challenge of navigating financial distress. Subchapter V of Chapter 11 bankruptcy, introduced in the Small Business Reorganization Act of 2019, offers a streamlined and less costly path to reorganization for small businesses. So, if you're a small business owner struggling with debt and can't meet your payroll, taxes, and other costs, Subchapter V of Chapter 11 bankruptcy might be the solution you need.
At Ast & Schmidt, P.C., we have skilled Subchapter V bankruptcy attorneys who will lead your business through the process, protect your assets, and ensure both your immediate and future financial security.
We're here to guide you through the Subchapter V of Chapter 11 bankruptcy process. Reach out to us at (973) 363-2260 or contact us online today for your free initial consultation.
Why Choose Ast & Schmidt, P.C.?
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Personalized Services Tailored for You
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Over 25 Years of Bankruptcy Experience
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Free Initial Consultations
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Available After Hours by Appointment
How Does Subchapter V of Chapter 11 Bankruptcy Work?
Subchapter V is designed to simplify the bankruptcy process for small business debtors, reducing legal complexities and costs. It allows for a more debtor-friendly reorganization, enabling small businesses to retain control while working through their financial obligations under a court-approved plan.
Eligibility Criteria
To qualify for Subchapter V:
- Your business must be engaged in commercial or business activities.
- Total secured and unsecured debts should not exceed $7,500,000 (subject to change after June 21, 2024).
- At least half of the debt must have arisen from business activities.
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"..Thank you Ast and Schmidt for all that you do!"
I have personally used Ast & Schmidt and have recommended them to friends and family members as well. Robert and Antoinette are always responsive, timely, and available to go over any questions or concerns I might have in what could be an otherwise stressful process. I can confidently say that I 100 percent trust Robert's guidance and quality of work. He and the staff go above and beyond to make sure I understand all of my options as well as the process from beginning to end. Antoinette always makes me feel comfortable when I call with questions and Robert's guidance and services have truly been a blessing in helping me transition out of some rough times so that I could move forward in my personal and professional endeavors. I can not recommend this firm highly enough. You will be well taken care of. Thank you Ast and Schmidt for all that you do!- Rena Z. -
"Throughout our experience with Ast & Schmidt, my husband and I were treated with the utmost respect and compassion."
Throughout our experience with Ast & Schmidt, my husband and I were treated with the utmost respect and compassion. Whenever there was a question (even during COVID), Rob Schmidt was most accessible and helpful to us during this difficult time. We would recommend them to anybody who is undergoing financial challenges. Everyone associated with the company is attentive and a pleasure to deal with, even regarding the most trivial matters. Certainly, when addressing the complicated issues that arise during legal proceedings, Ast & Schmidt provides seamless and impeccable attention to every detail.- Iris G.
The Process
Filing for Subchapter V involves several critical steps:
- Voluntary Petition: Start by filing a voluntary petition for relief under Chapter 11, specifying your election under Subchapter V.
- Required Documents: Submit required documents, including schedules of assets and liabilities, a statement of financial affairs, and a list of equity holders.
- Filing Fee: Pay the filing fee, which is subject to change but can be found on the official website of the U.S. Courts.
The Role of the Trustee
Unlike traditional Chapter 11 cases, Subchapter V appoints a trustee to facilitate the development of a consensual reorganization plan, oversee payments, and ensure the debtor is compliant with statutory obligations. The trustee works with both the debtor and creditors to reach a fair resolution.
The Reorganization Plan
Within 90 days of filing, the debtor must submit a reorganization plan that demonstrates how creditors will be paid over time. Subchapter V simplifies this process by eliminating certain disclosure requirements and creditor committees, making it easier for small business owners to propose a viable plan.
The Voting Process
Creditor voting under Subchapter V has been streamlined. Although creditors can object to the plan, their acceptance is not required if the plan does not discriminate unfairly and is deemed fair and equitable.
The Confirmation Hearing
A confirmation hearing will be held where the court will decide whether to approve the reorganization plan. The plan must meet specific criteria, including feasibility, compliance with bankruptcy laws, and it must be proposed in good faith.
Post-Confirmation
After the plan is confirmed, the small business debtor will make the agreed payments, overseen by the trustee. Successful implementation of the plan can lead to a discharge of certain debts and a more stable financial future for the business.
Our Subchapter V of Chapter 11 Bankruptcy Lawyers Are Here to Help You Overcome Your Financial Struggles
Subchapter V of Chapter 11 offers a promising avenue for small businesses to address their financial challenges without losing control of their operations. However, given the complexities involved, seeking advice from our knowledgeable and experienced bankruptcy attorneys is crucial. In fact, if your business is bigger than a one-person operation and you're considering Chapter 11 bankruptcy, you are required to be represented by a bankruptcy lawyer.
To learn more about Subchapter V of Chapter 11 bankruptcy and how our legal team at Ast & Schmidt, P.C. can help you, call (973) 363-2260 or get in touch with us online today for a free initial consultation.
