Will filing Chapter 7 Bankruptcy help or hurt?My mother owns a company in TX and is planning on closing the doors. She owes $30,000 in back sales taxes (3 years ago) to the state. She didn't charge any sales tax to her customers, thinking she wasn't suppose to, so instead of them going after her customers, the state is going after my mother. The state will not... | |
She cannot operate without a business license. If the state is at this point with her she will not have a business license soon. If she files a Chapter 7 then there will be a trustee hired to liquidate her company. This will end the business. She may be able to start a new company but it will be difficult.
If she has enough assets then she may be about to file a Chapter 11 bankruptcy.
At this point she has no options. She has to pay or file backruptcy. If she pays she can continue to operate. There are companies that will finance a company that is in Bankruptcy or close to it, but chances are if she can't pay $30k then she is done.
why didn't she think she didn't have to charge sales tax - she should have checked that out before she started the business - I've done sales tax returns for Texas - every county and town has their own unique sales tax setup - she should have talked to an accountant at the beginning at least
