We file Chapter 11 cases in New York for businesses. The usual cases have large payroll or trust fund taxes issues such as the following:
- IRS Payroll Tax Debt;
- NYS Payroll Tax Debt;
- NYS Sales Tax Debt.
We have filed Chapter 11 cases in NY for contractors, subcontractors, medical practices, restaurants, furniture stores and carting companies and the results that obtained were as follows:
- Reduced IRS and NYS payroll tax debt by over $1.3M with extended payout;
- Confirmed Chapter 11 case in Brooklyn with over a $700K discount in payroll tax debt with extended period double the statutory amount;
- Confirmed chapter 11 case and settled sales tax debt for less then 1/3 of the amount due.
These case studies were from cases filed before and after the new law. Recently, in 2007, the IRS changed their internal procedures and currently, any specialized bankruptcy deals and workouts in New York are subject to more scrutiny.
We file Chapter 11 cases in New York City, Chapter 11 cases in Brooklyn and we also do Chapter 11 filings in Central Islip, NY. These courts cover most areas in the tri state area, Long Island and Westchester counties.
Each Chapter 11 plan we file is unique to the client and tailored to their creditors and we do customized Chapter 11 plans in NYC, Brooklyn and in Long Island, NY. Since one of our partners is also a CPA, we can do operating report reviews and set up clients and their accountants on templates. All of these cumulative financial statements are used when we build a Chapter 11 plan to best suit the clients needs. We also have specialized programs tailored to build our plans including usage of EXCEL and POWERPOINT.
Chapter 11 Process:
- File Petition and all schedules;
- Release seizures, padlocks and unfreeze bank accounts;
- Attend initial conference with US Trustee Analyst;
- Attend 341 meeting with US Trustee and Creditors;
- Attend status conferences with court;
- File Monthly operating reports;
- Assume/Reject leases;
- Set Bar Date;
- File Chapter 11 Plan and Disclosure Statement;
- Send out Ballots after Disclosure Statement is approved;
- Confirmation Hearing;
- Make plan payments if plan accepted;
- Do any 363 sales needed to effectuate the plan;
- Do Fee Applications;
- Close Case.
This process is a long and time consuming process and should only be used by businesses that have:
- A business worth saving;
- Enough debt to make the cost worthwhile;
- Trust fund tax debt;
- A business that can be profitable after the filing;
- Management in place that can attend these required meetings and can work with counsel regarding financial information needed.