Bankruptcy for the self-employed is a legal way to have many debts forgiven for your personal company. This process can put you and your business on the road to financial recovery. To understand whether this is a viable option, contact the skilled and seasoned Ohio bankruptcy attorneys at Fesenmyer Cousino Weinzimmer.

Why Choose FCW for a Bankruptcy Filing

At Fesenmyer, Cousino Weinzimmer, we offer a free, personalized consultation to evaluate your financial situation. We provide counsel for all kinds of debt-relief options, such as Chapter 7 bankruptcy, Chapter 13 debt reorganization, and debt settlement negotiations with creditors.

Our firm prides itself on employing patience, compassion, and skillful guidance to guide clients toward their best possible outcomes. Our dedicated team of bankruptcy and debt-settlement attorneys work hard to ensure each client’s situation is handled professionally and uniquely.

We lay out the most beneficial options and discuss the benefits and challenges of each, all customized for your specific circumstances. You are always in control of each decision, informed by our combined 66 years of legal experience in this field.

FCW’s team begins implementing solutions immediately so you and your company can achieve financial freedom. Regardless of whether you should file a Chapter 7 bankruptcy under the means test or create a Chapter 13 repayment plan, we are dedicated to your financial stability.

How Self-Employment Affects Filing for Bankruptcy

Filing for bankruptcy is sometimes seen as a negative or desperate move to save a company. With the proper legal guidance, it can serve as a calculated approach that allows you to keep running your business and stop creditors from harassing you.

You can keep your assets and have debts forgiven so you can rebuild your company’s future and your life. When you are self-employed or an independent contractor, the process for filing for bankruptcy is a bit more complicated.

You will have to verify your income, and you might have to complete a means test to determine and prove your average income for the prior six months. While you usually have ups and downs in income when self-employed, you should be able to rely on your bookkeeping records.

If you do not have up-to-date books, you can still turn to bank statements, invoices, contracts, business receipts, and between two and four years of tax returns. FCW can assist you in understanding everything you need to pull together and complete the necessary filing forms.

How We Can Help Your Ohio Self-Employed Bankruptcy Case

Determining which type of bankruptcy filing you qualify for is only the first step in a successful case. You will need to present your materials in an orderly and complete fashion before a bankruptcy court, which may seem overwhelming when you are already worried about your business.

Helping you collect and organize the necessary documentation for your case is an area where the skilled Ohio bankruptcy attorneys at Fesenmyer Cousino Weinzimmer can help keep you from making mistakes. Each of our attorneys has over 16 years of many years of individual experience working on cases like yours. We are familiar with local court precedents procedures and how to present your case in the most advantageous way.

You may be concerned about adding attorney’s fees to your debt load. We understand these concerns, so we make our services as affordable as possible. When you work with FCW, you are making an investment in your business’s future.

Without professional legal representation, you could face a rejected filing and potentially lose everything to creditors. Our team focuses on efficiently analyzing your situation and your options, preventing you from making mistakes that can cost you more in the long run.

Should You File for Chapter 7 or Chapter 13?

When you began your business, you likely planned for success and tried not to focus on the potential for falling short of your goals. Therefore, you may know little about how to file for bankruptcy when you are self-employed and how the United States Bankruptcy Code will govern your case.

The code provides several ways for individuals to file. There are advantages and disadvantages to filing under the various chapters, and you will still be responsible for certain debts, including child support, spousal support obligations, student loans, and most unpaid taxes.

However, bankruptcy can eliminate credit card debt, medical bills and unsecured loans, and harassment by creditors. FCW can help you untangle the complexities of this process and assess your situation to determine your best option for self-employed bankruptcy in Ohio.

Your income and debt will be subject to a means test to determine if you qualify for Chapter 7. If you are not eligible, filing for Chapter 13 may still be an option.

Chapter 7 Bankruptcy

A Chapter 7 bankruptcy is used to discharge most or all of your consumer and business debts so they no longer have to be paid. The timeline of a Chapter 7 bankruptcy is around four months, allowing a fast turnaround so you can begin rebuilding credit quickly.

You might have to sell some property to help pay off creditors, but there are Ohio bankruptcy exemptions that list types of property that cannot be sold. Exemptions can include clothing, cars, equipment used for work (like tools), and household furnishings.

If you do not own a great deal of property, your possessions may all be exempt, qualifying you for a “no asset” case.

Chapter 13 Bankruptcy

With a Chapter 13 bankruptcy, you can repay some or all of your debt affordably over three to five years. This plan is best for those who don’t qualify for Chapter 7, who have a steady income, temporary financial problems, and a desire to repay some of the debt in order to keep an asset such as a car or a house.

Chapter 13 allows you to consolidate your payments to avoid fees and fines, stopping phone calls and letters from creditors.  If you successfully complete the court-approved payment plan, the debts covered by the plan are discharged.

What is a Means Test?

The means test is used to determine whether an individual’s monthly income is too high to qualify for Chapter 7 bankruptcy.  You must report and document your average income for the six months prior to filing, and the bankruptcy court compares that income to the median income for Ohio.

It then deducts specific monthly expenses to arrive at your monthly net disposable income. You can file Chapter 7 if your gross income is below the Ohio median for your household size. If you are self–employed and your debts are primarily business-related, you will not have to take the means test and can file a Chapter 7 bankruptcy even if you have a substantial monthly income.

For a Chapter 13 bankruptcy, the means test will determine the terms of your plan, such as how long it will last and how much you must pay to nonpriority, unsecured creditors.

Determining Your Income for the Means Test

If your income is over the Ohio median income for a household your size, you must complete the means test by calculating your income and expense information from your own personal records. Income includes:

  • Business income
  • Tax refunds for previous years
  • Rental income
  • Interest and dividends
  • Pensions and retirements plans
  • Amounts paid by others for your household expenses
  • Unemployment income

If you are self-employed, it can be more difficult to determine average income since business income may be irregular and undocumented.  Unfortunately, failure to provide documentation or an incorrect calculation can result in the dismissal of the bankruptcy case.

Steps to Provide Proper Documentation

If you are self-employed and considering bankruptcy, get your paperwork in order and immediately begin tracking and documenting your income. This gives you the strongest chance of success. There are two key steps to this process:

Track Your Income

As a business owner, you should keep regular records of income and expenses and create profit and loss statements. Along with these records, you will need to provide backup documentation, as your records may be questioned by the courts. Your FCW self-employed bankruptcy attorney can help you organize this material and present it effectively to the court.

Provide Supporting Documents

It will not be enough to collect a record of income. You will need significant and reliable documentation to support your claims. This is easiest if most of your transactions are done electronically or without using cash. Samples of these materials include:

  • Check stubs and proof of payments from payors
  • Bank statements to track deposits of checks or cash
  • Copies of checks from the bank or printed online
  • Signed statements for cash payments
  • Deposit records from your bank account for cash payments
  • Tax returns covering two years prior to your bankruptcy
  • Written invoices
  • Contracts
  • Year-to-date profit/loss statement

Other Documentation You May Need

If you own real estate, you must supply materials that prove the property’s fair market value. Mortgage statements can be used to show your current balances and payment amounts. You may also need to show a deed of trust and documentation of the property’s insurance coverage.

If you own vehicles used for personal or company purposes, you should be prepared to provide proof of ownership and insurance. You should have something that indicates their market value.

Finally, you must document any other circumstances that may affect your bankruptcy, such as paying alimony, child support, or any other significant expenses. This may include child support orders, divorce decrees, and post-divorce property distribution agreements.

Contact Fesenmyer Cousino Weinzimmer for Help Today

At FCW, we begin with a free consultation to evaluate your financial situation: income, debts, and goals. If bankruptcy is the right step for you, we are there to file for you, represent you in court, help rebuild your credit, and fight for you every step of the way.

If you are self-employed, it is critical that you not undergo the bankruptcy process alone. Delaying can only make matters worse, so contact the experienced Ohio bankruptcy attorneys at Fesenmyer Cousino Weinzimmer today.

Call one of our conveniently located office branches at 614-228-4435 (Columbus), 937-222-7472 (Dayton), or 877-654-5297 (Cincinnati), or contact us online for your free consultation so we can determine what debt relief solutions will work best for you.

Attorney Tom Fesenmyer

Attorney Thomas M. Fesenmyer (Tom) is dedicated to helping his clients solve their financial issues in a timely and cost-effective manner. Tom has personally filed several thousand cases and has the expertise to achieve immediate results for his clients, including stopping Foreclosures, Repossessions, Wage Garnishments, Law Suits, Utility Shut-offs, Creditor Harassment, Bank Attachments, and Pay-Day Loans. Tom’s goal for all of his clients is asset protection and debt elimination.[ Attorney Bio ]


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