Q: If a ch 7 personal bankruptcy filer has capital contributions to an LLC or an S Corp, how should it be noted?
Should that be as a loan to the company or a capital account? Is one better than the other in a chapter 7? Contributions were made a long time ago.
A: It should be listed as it is held in the books and records of the LLC.
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A: LLCs are very different than an S corp. To properly answer your questions and address your concerns, the best way to handle this is with an in person consultation with an experienced bankruptcy attorney. Good luck. Pick the best lawyer you can find and remember one rule: a good lawyer is generally never cheap, and a cheap lawyer is generally never good so don't choose based on price.
A: Your question's answer depends on (1) how it is listed on the corp or LLC books (2) how listed on your tax returns and (3) are you claiming this as an asset (a debt that is owed to you) or is it a liability that you have to still pay? All of these things make a difference in where and how it is listed in a bankruptcy petition.
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