Bankruptcy Law Questions? Ask a Bankruptcy Lawyer Now.
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You can file a chapter 7 or a chapter 13 personal bankruptcy. The chapter 7 is a liquidation type of bankruptcy where you will loose everything except exempt assets in favor of a fresh start. In a 13, you will be required to pay back some of your debts [ the secured debts like a car note or home loan] in a 3-5 year payment plan and you will likely pay pennies on the dollar for unsecured debts such as most medical bills and credit card debts. The business debts of a sole proprietor are his personal debts as well.
If you have a business that is not a sole proprietorship then it has to file a separate BK.
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Yes, you will need to take the means test here to see if you can file a 7.