Bankruptcy for Sole Proprietorship Question

[LisasCraftiques]

What is the name of your state (only U.S. law)? NOrth Carolina

I opened a small craft gift shop back in 2006 and struggled since opening. Once the economy went in the toilet so did my business. I have closed the store and am just selling online. My "business" has become more or less a hobby as it does not have much of an income. I got in over my head and am left with a ton of debt including back rent. The landlord has sent me a letter threatening to sue me and I have creditors calling me 5 times a day. I can not handle my debt at this moment and am not sure what my options are. Here is my question...my business is a sole proprietorship (DBA) can I go bankrupt without my husband also going bankrupt?

 

[bigun]

You can file a bk without your husband.
However, his income and his contributions to HH expenses will have to be disclosed to determine if you have enough disposeable income to fund a Chapter 13.
Most bk lawyers give free or lowcost initial consultations. Speak with a few and get all of your options explained.

 

[JETX]

my business is a sole proprietorship (DBA) can I go bankrupt without my husband also going bankrupt?

Yes.... but since your business is a d/b/a... it is YOU. You have to file bankruptcy in order to take your d/b/a with you.

 

[latigo]

Unquestionably a host of thorny issues arise where but one spouse files for debtor’s relief. And they differ between community property states where the spouses are categorically equally responsible for all marital debts and common law marital property states, such as North Carolina where they are not each categorically liable.

And this is not to imply that I have the answers because I don’t.

But mainly to suggest that before you file separately that you consult with a North Carolina attorney on the particular question of to what extent will North Carolina’s “doctrine of necessaries” protect your husband from your business creditors. (Which may be only resolved when one of the creditors takes your husband to court and he raises the doctrine as a defense.)

Also as to the vulnerability of your jointly acquired non-exempt property and how are the North Carolina exemption rights to be apportioned. (This really puzzles me.)

And what other debts incurred during the marriage are you jointly liable for and must be declared in your bankruptcy schedules. And what are the future consequences to your husband if you are discharged of those joint debts and he isn’t. Because you cannot pick and choose which of your creditors to list and not list.

If you must file, and there might be other options, don’t even think about doing it without a bankruptcy specialist!

I’m very sorry to learn of your financial reversals and wish you much luck.