If someone files a personal bankruptcy can their creditors go after business assets?

Get Legal Help Today

 Secured with SHA-256 Encryption

If someone files a personal bankruptcy can their creditors go after business assets?

I am half owner of a business and I need to file bankruptcy. Can the credit card company put a lien against the business or tap into the business account?

Asked on August 27, 2010 under Bankruptcy Law, California

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

How is the business structured? You say you are a half owner. If it is a partnership and you are one of two partners, then probably yes, personal creditors can generally go after business assets (your share of them, anyway), as there is no separation between you and the business. Indeed, the business's assets should be included in any bankruptcy filing, since again, they are your assets, at least in part.

If the business is an LLC or a corporation, then the business's own assets would be protected from personal creditors. Your ownership interest (your "stock" or "equity") is a personal asset that would be considered in certain kinds of businesses, but while that could affect your ownership, the business's actual accounts, assets, equipment, etc. should be proteced.

Before doing anything, consult with a bankruptcy attorney to see what is the best option for you.


IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

Get Legal Help Today

Find the right lawyer for your legal issue.

 Secured with SHA-256 Encryption