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Why might it be important to a general contractor to know what a bankruptcy subcontractor intends to do with an executory contract?

Why might it be important to a general contractor to know what a bankruptcy subcontractor intends to do with an executory contract?

Executory contracts are important in a bankruptcy case because they can be either a significant asset or a significant liability. As a general proposition, if the contract has value to the estate, it will be assumed. (However, certain executory contracts cannot be assumed.

Is Chapter 13 bankruptcy personal or business?

Only individuals can file for Chapter 13 bankruptcy. Business entities such as partnerships, corporations, or LLCs cannot do so. However, if you are a sole proprietor, you can file a personal Chapter 13 to reorganize your personal and business debts.

Can a self employed person file bankruptcy?

If you are self-employed, you are still able to file for Chapter 7 or Chapter 13 bankruptcy, just like any other consumer. However, it might be a little harder to provide your income according to the means test.

Do you need receipts for bankruptcy?

What the Bankruptcy Code Requires. In order to receive a discharge of debts in a Chapter 7 case, the debtor must have kept and maintained adequate books and records from which their financial situation can be be determined. It includes proof of income and expenses, and assets and debts.

Can a sole proprietorship file a chapter 13 bankruptcy?

Meeting Qualifications. Businesses, even sole proprietorships, cannot file Chapter 13. The bankruptcy code also prohibits stockbrokers and commodity brokers from filing under Chapter 13, even if their debts are personal. Individuals who can demonstrate they have the means to pay down debts are eligible to file.

How does a chapter 13 bankruptcy case start?

A chapter 13 case begins by filing a petition with the bankruptcy court serving the area where the debtor has a domicile or residence.

Who is eligible for Chapter 13 bankruptcy relief?

Chapter 13 Eligibility. Any individual, even if self-employed or operating an unincorporated business, is eligible for chapter 13 relief as long as the individual’s unsecured debts are less than $394,725 and secured debts are less than $1,184,200. 11 U.S.C. § 109(e).

Who is appointed trustee in Chapter 13 bankruptcy?

In a situation where only one spouse files, the income and expenses of the non-filing spouse is required so that the court, the trustee and creditors can evaluate the household’s financial position. When an individual files a chapter 13 petition, an impartial trustee is appointed to administer the case. 11 U.S.C. § 1302.

A chapter 13 case begins by filing a petition with the bankruptcy court serving the area where the debtor has a domicile or residence.

Can a single person file a chapter 13 bankruptcy?

For single individuals or married couples with regular income, a Chapter 13 bankruptcy allows the debtor (s) to propose a repayment plan so that all or some of the debts are paid over a certain time period.

What happens when a contractor files for bankruptcy?

Typically, that stay precludes a pre-bankruptcy creditor from starting or continuing a collection action or proceeding in state court. If the homeowner’s transaction occurred post-petition, the homeowner may initiate a lawsuit to recover funds advanced to the contractor.

What happens to contracts and leases in Chapter 13 bankruptcy?

The bankruptcy code talks about executory contracts and unexpired leases. “Executory” means the contract is still in force—that is, both parties are still obligated to perform important acts under it.