Legal Question in Bankruptcy in Maryland

I own a very small sole proprietor LLC that is in my name alone. We have two credit cards jointly. I am having her removed from one and she having me removed from one. These are our only joint debts other then our house that she is giving me back my 50K that I put down on it so that i can use it to grow my business. With recite of the 50K my name will be removed from the house placing it strictly in her name. That leaves us with no jointly owned assets or debts. If my business was to fail in two years, would she be protected if I file bankruptcy and walk away from the business and its debts? Or will there still be legal way for them to come after her for my debts? She has a lot of family money that I must protect.


Asked on 6/14/11, 11:00 am

1 Answer from Attorneys
Cedulie Laumann Arden Law Firm, LLC

Hi and thanks for your post. Unfortunately the first line of your post is contradictory - a business may be a sole proprietorship OR an LLC but not both at the same time. Perhaps you mean a single owner LLC treated as a disregarded entity for tax purposes? Any debt in the name of the LLC should in no way affect a non-owner and shouldn't even affect an owner unless it is tax related or subject to a personal guarantee. Your post also does not mention if the "she" referred to is a spouse or not, which fact makes a significant difference for planning purposes. There are legal ways to protect assets from claims of creditors, particularly when planning well in advance of any actual or threatened collection. You may wish to consult with an attorney to talk about your specific situation and map out some basic planning. While I hope this post helps answer your question please not that it is not a substitute for legal advice.

Read more
Answered on 8/24/11, 6:59 pm


Related Questions & Answers

More Bankruptcy Law questions and answers in Maryland