LLCs and Personal Bankruptcy
LLCs (limited liability companies) are very common and are one of the preferred business structures in todays business economy. For the most part, LLCs protect or insulate members from personal liability regarding business debt.
But what if the LLC is a single member LLC an he or she has personally guaranteed the debt? Well, if the owner personaly guaranteed the debt, then the company protection is lost. The business and the individual become responsible for the debt. If that is the case, the debtor may want to think about personal bankruptcy and taking the company into bankruptcy. This can be accomplished through a chapter 7.
Taking a business into chapter 13 cannot be done. If the business was looking to restructure or reorganize, the only option would be Chapter 11. In fact, recent Florida cases have held that the assets of a single member LLC may be considered when the owner files for personal bankruptcy.
If you have questions about bankruptcy and foreclosure in Florida contact a foreclosure defense and bankruptcy attorney.
Greg Gilbert
Keith Maynard
