So, I’m seriously considering filing for bankruptcy and have a few questions. I used to run a medical marijuana business, and I know that filing for bankruptcy can be tricky because of the whole federal legality issue. The thing is, I’m no longer in business, and most of the equipment was rented or borrowed, so I don’t really have assets. I should be able to file for Chapter 7, right? Also, I think I might have a lawsuit, but I can’t afford to take it on. Will the trustee handle that for me? I also grow plants for personal use but don’t make money from it. Can my bankruptcy filing be dismissed because of that? Any advice would be appreciated. FYI, I have a lot of debt, including from the utility company. I’m just trying to figure out if this is the right step.
I totally get your situation. I was in a similar spot. As long as you’re no longer operating the business and your personal use of the plants isn’t for profit, you should be fine with Chapter 7. The tricky part is how bankruptcy courts handle cannabis-related businesses because of federal law, but if you’re not actively running the business anymore, that should help. Also, any lawsuit you have can be taken over by the trustee if it’s part of the bankruptcy. They’ll handle any potential recovery for creditors. It’s a lot, but it seems like you’re on the right track.
@Brigham
Thanks for the input! I was really worried about the whole marijuana aspect. It’s good to know that as long as I’m not actively running it, I shouldn’t have too much trouble. Do you know if starting a new job after filing would affect the bankruptcy?
@Dale
No problem! And no, once you file for bankruptcy, any money you earn after that is yours to keep. The trustee only takes what you have before filing. So, if you start a new job after, that income is yours.
@Dale
Yeah, once you’re in bankruptcy, your post-filing income is safe. The trustee can’t touch it. So, you don’t have to worry about that. It’s just about what’s in your possession before the filing.
@Brigham
That’s good to know. I was worried about losing my paycheck if I filed. But I guess I’m still stuck with all the debt before I file. Hopefully, I can get things moving soon.
Dale said:
@Brigham
That’s good to know. I was worried about losing my paycheck if I filed. But I guess I’m still stuck with all the debt before I file. Hopefully, I can get things moving soon.
Yeah, it’s tough but hang in there. If you have debts that you can’t manage, Chapter 7 will clear it. Just make sure you document everything properly and keep track of any income and assets before you file.
Dale said:
@Brigham
That’s good to know. I was worried about losing my paycheck if I filed. But I guess I’m still stuck with all the debt before I file. Hopefully, I can get things moving soon.
I know it feels like a lot now, but once you file, things should start to calm down. Chapter 7 isn’t easy, but it can really help with wiping out those debts.
Just so you know, you can’t go back to your old marijuana business after filing for bankruptcy. But if you start something completely new, like an LLC with a partner, that wouldn’t be the same business as the one you filed bankruptcy for. So, you’re good to go with a new venture down the line.
@Teegan
That’s a relief! I wasn’t sure how starting something new would affect things. So, if I create a new LLC, it’s totally separate from the old one?
Dale said:
@Teegan
That’s a relief! I wasn’t sure how starting something new would affect things. So, if I create a new LLC, it’s totally separate from the old one?
Yeah, exactly. A new LLC is a completely separate business entity. You wouldn’t be tied to your old one at all, as long as it’s not related to the same activities you were doing before. That’s a great way to move forward.
Dale said:
@Teegan
That’s a relief! I wasn’t sure how starting something new would affect things. So, if I create a new LLC, it’s totally separate from the old one?
That’s right! Starting fresh with a new LLC means you can legally separate the old business from the new one. It gives you a clean slate.
@Teegan
This is really helpful! I’ve been trying to figure out how this could work if I decide to start something new later. A new LLC sounds like a good way to go.
Dale said:
@Teegan
This is really helpful! I’ve been trying to figure out how this could work if I decide to start something new later. A new LLC sounds like a good way to go.
Definitely! Just be sure to keep things separate, especially when it comes to finances. That way, there’s no chance of it being linked to your previous business.
It’s good that you’re thinking through all this. Bankruptcy can be confusing, especially when it involves businesses like yours. Just remember that the trustee can handle any lawsuit you have, but only if the lawsuit is a part of your bankruptcy estate. If you’re not sure about the lawsuit situation, it might be helpful to speak with a bankruptcy lawyer for more details on that.
@Zane
Thanks for that. I was wondering about the lawsuit part. I’ve got no money to fight it on my own, so if the trustee handles it, I guess I just wait for them to take over, right?
Dale said:
@Zane
Thanks for that. I was wondering about the lawsuit part. I’ve got no money to fight it on my own, so if the trustee handles it, I guess I just wait for them to take over, right?
Exactly, the trustee would take over and potentially recover any damages on your behalf. But it can take a while, so just be prepared for a wait. It’s a good thing you’ve got that option though.
Dale said:
@Zane
Thanks for that. I was wondering about the lawsuit part. I’ve got no money to fight it on my own, so if the trustee handles it, I guess I just wait for them to take over, right?
Yes, the trustee will take control of any lawsuit you have, and any potential recovery from that lawsuit will be used to pay off creditors. Just keep in mind that they have a lot of cases to manage, so it could take a while.
@Zane
Okay, so I don’t have to worry about paying for the lawsuit upfront. I guess I’ll just have to be patient and see how it plays out.
Dale said:
@Zane
Okay, so I don’t have to worry about paying for the lawsuit upfront. I guess I’ll just have to be patient and see how it plays out.
Yep, exactly! The trustee will handle it. Just stay on top of things and keep them updated if anything changes. The more you help them, the quicker it can go.