One of the major benefits of filing for bankruptcy is that it offers a way for people or businesses struggling financially to obtain a discharge from some of their debts. This means that they are able to have some of their debts completely written off.
The first step after deciding to file for bankruptcy is choosing which bankruptcy Chapter to file with. Chapter 12 bankruptcy is a specific type that is created especially for, and is only available to, family farmers and fishermen. In this way, the rules and regulations attached to Chapter 12 bankruptcy are specifically designed to benefit these types of businesses and the people who run them.
How do I get a discharge from my debts with Chapter 12 bankruptcy?
A bankruptcy filing will often result in a repayment being made, and Chapter 12 bankruptcy is no exception. The income of farmers or fishermen is assessed to generate a way that they can both support their family and repay some of their debts. In the case of Chapter 12 bankruptcy, there is no discharge benefit until the bankruptcy payment plan is successfully completed. This means that the farmer or fisherman must repay the debts that have been agreed upon over a period of three to five years before they are able to have the remainder of their debts discharged.
If you run a farming and fishing family business and are struggling with accumulating debts, it is a good idea to take action. Chapter 12 bankruptcy helps you to restructure your business so that it will be more successful in the future.
Source: The Balance, "What is Chapter 12 Bankruptcy?," accessed March 23, 2018