Vero Beach Chapter 12 Bankruptcy Attorney
Florida’s farmers and commercial fishermen face special economic challenges. In recognition of this, Congress created a special chapter of the bankruptcy code to help individuals in these professions address potentially catastrophic debt situations. Chapter 12 bankruptcy enables qualified individuals to seek court approval for a debt repayment plan in a process that is more streamlined than other forms of bankruptcy.
But even though it may be less complicated in some respect, you should still work with an experienced Vero Beach Chapter 12 bankruptcy attorney. At Markarian & Hayes, our lawyers can help your family farm or fishing business take advantage of Chapter 12’s unique provisions. We will work with you, your creditors, and the bankruptcy court to seek approval of a plan that keeps you in business while addressing your debt situation.
The Chapter 12 Process
As noted above, Chapter 12 is specifically designed for family farmers and family fishermen. Debtors may be individuals, married couples, of corporations or partnerships. There are certain qualifications a debtor must meet under Chapter 12. For individuals and married couples, these qualifications include:
- The debtors must be engaged in an active farming or commercial fishing operation as of the date they file for Chapter 12.
- Their total debts must not exceed $41,53,150 for a family farm, or $1,924,550 for a commercial fishing operation.
- No more than 50 percent of the debtors’ gross income must come from the farming or commercial fishing operation.
- At least 50 percent of the individual or couple’s debts must be related to the family farm, or 80 percent if they run a commercial fishing operation.
If you meet these and other qualifications, you can file a voluntary Chapter 12 petition with the bankruptcy court for the area you reside in. (Unlike some other types of bankruptcy, your creditors cannot file an involuntary Chapter 12 petition to force you into court.) Once you file, the court issues an automatic stay preventing your creditors from taking any further collection action against you without a judge’s approval. The court will also name a bankruptcy trustee to administer your case.
Thereafter, you have 90 days to file a repayment plan with the court. In this respect, Chapter 12 is much like a Chapter 13 bankruptcy. The court will not simply discharge your debts outright. Instead, you must repay as much of the debt as possible over a 3-to-5 year period. For this reason, you must have “regular annual income” from your farm or fishing operation. After you file your plan, your creditors will have an opportunity to be heard, and the court will hold a “confirmation hearing” to determine whether your proposal complies with the law. Once approved, the repayment plan is legally binding upon you. However, once you complete the repayment plan, the bankruptcy court will issue a formal discharge releasing you from any further obligations to pay your creditors.
Contact Markarian & Hayes to Speak with a Vero Beach Chapter 12 Bankruptcy Attorney Today
Chapter 12 may sound simple in theory. But in practice there are many issues that can–and will–arise. It is in your best interest to work with a qualified Vero Beach Chapter 12 bankruptcy attorney who understands the system and knows how to make it work for your family farm or commercial fishing business. Contact Markarian & Hayes at 772-794-3379 to schedule a confidential consultation today.