Barry Levine, a bankruptcy attorney with nearly 45 years ofexperience, helps entrepreneurs facing overwhelming debt navigate tough choices. He stresses that optimism, while essential for starting businesses, often blinds owners to financial reality until it's too late—leading them to drain home equity or 401(k)s in futile attempts to save failing ventures.Levine prefers corporations over LLCs for their lower setup costs ($275 vs. $500) and tax advantages via Subchapter S election, warning that LLCs filingSchedule C can make owners fully liable for trust fund taxes without the corporate "discount." He advocates early action: record a Massachusetts homestead ($35) to protect up to $1 million in home equity, and secure family loans with UCC filings to prioritize them in liquidation.

Alternatives to bankruptcy include composition agreements,trust mortgages, or—Levine's favorite for small businesses—assignments for the benefit of creditors (ABC). This non-intrusive, paper-based liquidation lets owners buy back assets via a new entity ("Newco") for a promissory note, shedding debt while restarting quickly, often with creditor assent since chasing a gutted company yields nothing. Chapter 11 or Subchapter V reorganizations pause collections via automatic stays but are costly and rarely last a year. Personal guarantees on SBA loans, credit cards, or taxes oftenforce individual filings post-business closure, though trust fund taxes (unlike income taxes) are non-dischargeable and carry 10-year IRS liens that quietly expire if unrenewed.

Bankruptcy isn't catastrophic: discharged debtors becomeattractive credit risks (unable to refile for 8 years), receiving card offers soon after. Reaffirming debts like mortgages or car loans preserves credit reporting, while skipping reaffirmation discharges deficiencies—useful for underwater vehicles. Student loans, once undischargeable, now can be wiped outwith proof of good-faith efforts (e.g., income-based plans). Levine urges proactive "bulletproofing": encumber assets early, avoid sole proprietorships, and consult cynics for reality checks. As he quips, "It's only money"—creditors survive, but health and peace of mind matter more.

Connect with Barry: https://www.youtube.com/@barrylevine336https://www.levineslaw.com/