Business Debt/Dissolution & Debt

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Expert: - 11/1/2010


Question
Hello and thank you very much for taking the time to review my question.  In June 2010 I incorporated a company in the state of PA.  I am currently in the process of dissolving the previous corporation which currently has one debt of approx. $20,000.  My question is, "Can the new entity assume the debt of the old company?  And if so, how should I proceed to make this a legal debt transfer?

Answer
Anna:
Thank you for your inquiry. As I am not an attorney this is not to be considered legal advice. If your old corp had debt such as "vendor or supplier" bills owed and there is NO personal guarantor, than the old debt still and will only ever belong to that entity. If the entity is insolvent, the debt is basically uncollectible. However, if that debt was "bank related" such as credit cards, the bank almost always requires a guarantor, probably you who backs up the debt even if it has the corporate name. Therefore in that instance, no matter the status of the entity, you are responsible for repayment of that debt. If I were you, just leave everything as is and not mire the new corporation with old baggage as it will have an opportunity to start fresh. If you want to pay the old debt with new corporate revenue, that is simply a bookkeeping issue and does not require legal transfer. I hope you found this answer helpful, if so please take a moment to provide a positive rating and comment so others may benefit as well.

Respectfully,

Christine Janklow

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Christine Janklow

Expertise

As President of SettleSource,Inc. a business debt settlement firm, I invite you to inquire about all aspects of business debt solutions to best determine which may be most appropriate. If you have questions such as: What is debt settlement and how process provide debt relief to my business? What options are available to deal with my business debts? Is it possible for a business owner to negotiate their own settlements? Why is debt settlement preferable to filing a bankruptcy or debt consolidation? Why are creditors willing to provide settlements to a business? How will settling debts affect credit scores? or How to rebuild a business after debt is eliminated. Please ask it now! For more information regarding how debt settlement can help your business, please visit www.SettleSource.com and place your inquiry. Mention All Experts to have a confidential no cost consultation with Christine. If this is your business situation time may play a very important factor in getting matters resolved proactively before they have negative affects on the business.

Experience

My expertise is specific to providing business solutions that will have profound positive impacts on the financial health of businesses. I have 25 years experience as an entrepreneur and have developed national sales programs; strategic alliances; product development; marketing programs; business and turnaround plans and debt settlement programs all providing methods to improve the financial outlook for large and small businesses. In the area of commercial debt settlement I have over 10 years experience working with large and medium corporations and closely held businesses to enable successful debt reduction and turnaround. I am a professional debt arbitrator and have negotiated with major banking institutions as well as vendors, suppliers and other trade creditors.

Organizations
Provisors;Turnaround Management Association; Los Angeles area

Publications
Accounting Today; Web CPA; National Restauarant Association;Los Angeles Daily News; Today Magazine Monthly series of business articles entitled "Brand News."

Education/Credentials
Bachelor of Business Administration; Associate of Arts Merchandising

Past/Present Clients
American Airlines, American Express, Safeway Inc., New York Life, consumer products manufacturers; retailers, food service industry and other small businesses and service providers.

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