Who Qualifies for Chapter 11 Bankruptcy in Ohio?

December 2, 2024

Who Qualifies for Chapter 11 Bankruptcy in Ohio?

Chapter 11 bankruptcy is often associated with large corporations, but it’s a flexible option available to a wide range of individuals and businesses facing financial difficulties. At Roderick Linton Belfance, LLP, we assist the Akron public in understanding and navigating Chapter 11 bankruptcy to regain financial stability.


What Is Chapter 11 Bankruptcy?


Chapter 11 bankruptcy, also known as "reorganization bankruptcy," allows businesses and individuals to restructure their debts while continuing operations. Unlike Chapter 7, which involves liquidating assets, Chapter 11 focuses on developing a repayment plan to satisfy creditors over time.


Who Qualifies for Chapter 11 Bankruptcy in Ohio?


  • Businesses
  • Corporations: Both large and small corporations can file for Chapter 11 to reorganize their debts and continue operations.
  • Partnerships: Partnerships facing financial challenges can use Chapter 11 to restructure debts while preserving the business.
  • Limited Liability Companies (LLCs): Chapter 11 offers a pathway for LLCs to reorganize their financial obligations.
  • Individuals
  • Individuals with substantial debts who do not qualify for Chapter 13 due to debt limits may file for Chapter 11. This includes:
  • High-income earners with significant business or personal debt.
  • Individuals with complex financial situations involving multiple properties or business interests.
  • Small Businesses (Subchapter V)
  • In 2019, the Small Business Reorganization Act introduced Subchapter V to streamline the Chapter 11 process for small businesses. To qualify:
  • The business must have noncontingent, liquidated debts under approximately $7.5 million.
  • At least 50% of those debts must arise from commercial or business activities.
  • Subchapter V is designed to reduce costs and simplify the reorganization process, making Chapter 11 more accessible to small businesses.


Benefits of Chapter 11 Bankruptcy


  • Business Continuation: Allows businesses to remain operational while addressing debt issues.
  • Debt Restructuring: Offers flexibility in renegotiating payment terms with creditors.
  • Automatic Stay: Immediately halts creditor collection efforts, giving the filer time to develop a repayment plan.


How Roderick Linton Belfance, LLP Can Help


Navigating Chapter 11 bankruptcy can be complex, but you don’t have to face it alone. At Roderick Linton Belfance, LLP, we provide personalized legal assistance to the Akron public, helping businesses and individuals explore their options, develop reorganization plans, and work toward financial recovery.


If you’re considering Chapter 11 bankruptcy in Ohio, contact us today to schedule a consultation. Let us help you take the first step toward a stronger financial future.

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