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The means test is a financial assessment used to determine if you’re eligible for Chapter 7 bankruptcy. The goal? To ensure that people who can afford to repay some of their debts don’t use Chapter 7 bankruptcy to wipe out all their debts unfairly. This step generally follows a two-step process. Step 1: Comparing your income to Maryland’s median You will need to calculate your average monthly income for the six months before filing for bankruptcy. This includes most types of income, such as: Wages

Franchise businesses facing financial struggles may consider Chapter 11 bankruptcy to restructure debt and continue operations. The impact of Chapter 11 on franchise agreements can vary, depending on the terms of the contract and court decisions. Understanding how Chapter 11 influences franchise relationships is crucial for both franchisees and franchisors. Treatment of franchise agreements during Chapter 11 When a franchisee files for Chapter 11, the bankruptcy court decides whether the franchise agreement remains in effect. The franchisee can either assume or reject the agreement. Assuming

Tax debt can be one of the most challenging types of debt to manage. For those struggling financially, filing for Chapter 13 bankruptcy may provide some relief.  Understanding whether Chapter 13 can discharge tax debts is necessary for making informed decisions under Maryland law. Types of tax debts eligible for discharge Not all tax debts are eligible for discharge under Chapter 13 bankruptcy. To qualify, the tax debt must be income tax owed to the federal or state government. You typically cannot discharge property taxes,

Chapter 7 bankruptcy can be a viable option for small business owners who face overwhelming debt. However, it’s important to understand the long-term consequences before proceeding. Impact on personal credit Chapter 7 bankruptcy remains on personal credit reports for up to 10 years. This can make it difficult for small business owners to secure personal loans, lines of credit, or even credit cards, which are often crucial for both personal and business needs. Loss of business assets For small business owners operating as sole proprietors,

Chapter 11 bankruptcy offers business owners the chance to reorganize their debts and continue operating. However, it can raise genuine questions about the future of commercial leases.  For entrepreneurs in Maryland, understanding how Chapter 11 bankruptcy impacts commercial leases is important for making informed decisions during the restructuring process. What happens when you file for Chapter 11 bankruptcy? When a business files for Chapter 11 bankruptcy, an automatic stay immediately goes into effect. This stay prevents creditors, including landlords, from taking any action to collect