Chapter 11 bankruptcy is similar to Chapter 13 in that each involves a reorganization of your debt to pay off creditors over time. However, unlike Chapter 13 bankruptcy, Chapter 11 is available to businesses as well as individuals. In that respect, it is similar to Chapter 7 liquidation.
As with any bankruptcy proceeding, Chapter 11 involves meeting certain requirements. United States Courts outline an overview of the process.
As an individual or business owner, you may be able to file Chapter 11 on a voluntary basis. However, creditors that meet certain requirements can file an involuntary petition against you.
If you file Chapter 11 voluntarily, you must provide basic information such as your name, residence and tax identification number. As an individual, your social security number fulfills the lattermost requirement. However, if you file on behalf of a business, you must also provide the location of your assets.
In addition to these basic requirements, your petition must also include the following:
- Statement of financial affairs
- Schedule of executory contracts and unexpired leases
- Schedule of current income and expenditures
- Schedule of assets and liabilities
It is ironic that filing for bankruptcy because you cannot pay your debts requires you to pay fees, but it is nevertheless a reality. The court may allow you to pay in four monthly installments, but the final installment payment must be no later than 120 days after the date you filed for bankruptcy. Otherwise, the requirement is that you pay the clerk of court a $550 miscellaneous administrative fee and a $1,167 case filing fee upon submitting your petition.