Sometimes the best option for a business in financial straits is filing bankruptcy. Filing bankruptcy does not always result in the cessation of a business. In fact, bankruptcy is sometimes the very thing that a business needs to get a fresh start. Most business entities can choose between Chapter 7 and Chapter 11 when filing bankruptcy. Only sole proprietorships can file for bankruptcy under Chapter 13, but they must meet strict requirements to do so. The bankruptcy proceeding varies significantly depending on which Chapter of the Bankruptcy Code a business files under.
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