What are the requirements to file chapter 11 bankruptcy?

On Behalf of | Oct 2, 2020 | Bankruptcy |

Chapter 11 is sometimes referred to as “reorganization bankruptcy.” If you own a corporation or sole proprietorship in North Carolina, this may be an option you are looking at to resolve your debts.

The United States Courts state that while there are some exceptions for emergency situations, typically if you want to file under chapter 11, you must have received credit counseling from an approved agency within 180 days of filing. So what other requirements will you need to meet if you want your debts to be resolved under chapter 11?

Fees and costs

While paying more money is probably the last thing you want to consider if you are looking at bankruptcy, it is important to keep in mind that if your petition is approved, it can protect your stocks and assets, thus saving you from disaster in the long run. You can think of these costs as an investment in keeping your business afloat.

You will need to pay an administrative fee of $550, which can be made in installments. There is also a $1,167 case filing fee. If you do choose to pay in installments, you must make your final payment within 120 days of filing your petition.

Procedural requirements

In addition to the initial petition you file, you will also need to file some information with the court. You must provide a statement of your financial affairs and a schedule of unexpired leases and executory contracts.

You will have to provide both a schedule of your current expenditures and income and a schedule of all of your liabilities and assets. You should also be prepared to file a plan of reorganization and a written disclosure statement.