Recent bankruptcy filing statistics reveal March 2021 saw the highest spike in combined commercial and non-commercial bankruptcy filings since the start of the pandemic. Filing for bankruptcy can provide needed relief from overwhelming debt.
A recent piece in The Washington Post discusses the plight of commercial interests that have held on throughout the pandemic but are beginning to falter. The Post notes bankruptcy filings for oil and gas, entertainment, software, retail, food service, and real estate companies were up by at least 50 percent in 2020. Chapter 11 filings, used to restructure the debt load of a potentially viable commercial interest, were up approximately 30 percent from the previous four years.
While a strong recovery is expected from the pandemic, no one is quite sure what recovery looks like and when it happens. Recent stimulus spending promises to boost the economy and carry businesses over to the retail rebound expected when vaccination rates are much higher.
Each chapter of the bankruptcy code is intended to give individuals and businesses a restart when they are struggling with untenable financial circumstances.
For many businesses, Chapter 11 continues to provide structure and debt relief needed to turn around a business near the brink. A couple of features of a Chapter 11 bankruptcy filing include:
There were approximately 6,917 Chapter 11 bankruptcy filings last year, and the pace and need for business reorganization has not slowed in 2021. If your business bottom line continues to sink, Chapter 11 may provide the options you need to reassess use of assets and redirect your company toward survival.
The economic upheaval caused by the pandemic is not near its end. When you need more options than waiting it out, speak with a tax attorney with experience who can successfully guide you through the bankruptcy process.
The tax group at Robert J. Fedor, Esq., LLC represents business and individual clients dealing with business stress, tax litigation, and allegations of tax crime. When experienced tax advice is needed locally or internationally, call 800-579-0997 or contact us for a free consultation.