People who operate their own businesses often think of that business and themselves as being a single entity. If the business is a distinct corporate entity, that entity has its own assets and its own debts. However, in most situations, the debts of the business are personally guaranteed by its owners. If the business entity loses money, the owners usually end up with substantial personal debt, often because they have poured their personal resources into the business to get it started or to keep it alive in difficult times.
That is the situation in normal times. However, personal and economic activity have been forced to a virtual halt by the current public health crisis. As a result, hundreds of small businesses have been forced to close and their owners will be left to deal with the debt hangover. There may be short term loans made available, but these will have to be paid back. Businesses will survive only if they are able to restart promptly and quickly achieve positive cash flow. Inevitably there will be business owners who must face bankruptcy.
If a corporate entity is put into bankruptcy, its unencumbered assets are liquidated and there may be partial payments made to its creditors. THAT DOES NOT RESOLVE THE PERSONAL DEBT which is the fallout of most business closures. If you have a business which is building up your personal debt, you should not wait to consult an experienced bankruptcy attorney Doug Wickham can help you determine what is the best way to close (or perhaps reorganize under chapter 11) your business and to deal with the personal debt which it has built up. Contact him from this site or call him at 919-239-0488.