Under chapter 7, a trustee is appointed to collect and sell all property that is not exempt and to use any proceeds to pay creditors according to priorities of the Bankruptcy Code.
In the case of an individual, the debtor is allowed to claim certain property exempt. In exchange for this, the debtor gets a discharge, which means that the debtor does not have to pay certain types of debts.
Corporations and partnerships do not receive discharges. Consequently, any individuals legally liable for the partnership’s or corporation’s debts will remain liable. Therefore, individual bankruptcies may be required as well as the corporation or partnership bankruptcy.
Certain types of entities such as banks and insurance companies may not be eligible to file bankruptcy, but almost all other entities can file under chapters 7 and 11. A business that is NOT a partnership, corporation or business trust, cannot file a separate bankruptcy on its own but must be included in the personal bankruptcy of the owner(s)
Geygan & Geygan, Ltd. is a Debt Relief Agency because we help people live without debt through various means including bankruptcy.