Newark Consumer Law Firm

Small Business Bankruptcy Lawyer in Newark

Did you know that United Airlines once went bankrupt? The corporation used Chapter 11 bankruptcy to restructure its finances. The case began in 2002, and the company successfully emerged four years later.

This is just one example of corporations using Chapter 11 to reduce financial obligations, restructure their operations, and regain their financial footing. Some large corporations have even been bailed out by the government, such as General Motors in 2009.

Unfortunately, small businesses have not seen the same success in the four decades that Chapter 11 has been available. Chapter 11 is complex and expensive, and small businesses generally lack the resources to successfully navigate this process.

Congress recognized the plight of small businesses, however, and passed the Small Business Reorganization Act (SBRA) of 2019. The SBRA added Subchapter V to Chapter 11, and this section provides a streamlined form of debt reorganization that is exclusively available to qualifying small businesses.

The Benefits of Subchapter V

Subchapter V differs from regular Chapter 11, which is good news for qualifying small businesses.

To the benefit of small businesses, Subchapter V does NOT require:

  • Plan approval from creditors;
  • Creditor’s committees;
  • Disclosure statements; or
  • Creditor repayment according to the Absolute Priority Rule (i.e. repaying all creditors in full before retaining ownership interests).

Subchapter V also allows for a debt discharge upon completion of a 3-5-year repayment plan, similar to what individuals experience through Chapter 13. As a result, small businesses have a much higher likelihood of reorganizing without liquidating all their assets and going out of business.

Do You Qualify for Subchapter V?

Qualifying for Subchapter V is relatively simple. To file under Subchapter V, your business must owe no more than $2,725,625, at least 50% of which was accrued through commercial expenses. If you file before March of 2021, you can qualify if you owe no more than $7,500,000, due to a temporary increase established by the Coronavirus Aid, Relief, and Economic Security Act.

Deeper Understanding. Better Solutions.

Defining Success Together
  • Discharge Debts & Fix Your Credit
  • Flexible Payment Options
  • Virtual Options & Phone Capabilities
  • Always Work Directly with an Attorney

Why Attorney Murphy?

Attorney Todd Murphy founded Dublin Packard, Attorneys at Law in 2009. Since then, he has helped countless businesses navigate and overcome financial uncertainty. He is personally driven by the injustices we see on a daily basis, in which corporations wield enormous amounts of power (and, of course, the resources needed to eliminate their debts). Small businesses have been left behind—but Attorney Murphy refuses to stand by and allow this to happen to you.

Our law firm is here to provide high-quality legal services at a price you can afford.

We believe small businesses are the backbone of the United States, and our goal is to help you use any and all legal strategies at your disposal to overcome your financial crisis and restore your confidence in your future.

Let’s begin with a courtesy evaluation. Schedule yours by contacting us online or calling (862) 305-4901 today.

Real Clients. Real Reviews.

Get to know us through their experiences. 
  • “You made me feel so good again and you helped me save my home.”

    - Michelle
  • “He provided excellent advice and guidance for myself and my company.”

    - Gary
  • “I’m rebuilding my credit and in two years I should have my credit score back up to 750.”

    - Dave
  • “Then we found Todd Murphy Law...Wow! Were we glad we did.”

    - Jack
  • “With Todd Murphy's help I was able to stop the sale and save my home.”

    - Joanne
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