If I am a business owner in financial trouble, what is the first thing you recommend?
Minneapolis Bankruptcy attorney Steven Silton discusses what a business owner should do first when thinking about filing bankruptcy.
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I think the most important thing when you’re either an officer, director, or owner in a business facing financial difficulties is to assess and recognize the financial difficulty as soon as possible. The quicker you can diagnose your own financial trouble, the more options that you’ll have, and the more ability bankruptcy professional will be able to assist in the process. It’s also very important to recognize that while you are in financial distress, there are certain financial obligations that don’t exist when you’re not in financial distress.
There’s a new area of law called deepening an insolvency, which has been an ongoing kind of evolution over the last ten years. And deepening an insolvency can provide for a liability for a business owner for corporate-incurred debts while the company’s in financial distress.