California | Bankruptcy
Legal Question
Bankruptcy vs. debt consolidation? My husband is a large shareholder (the shares were part of his employment package) and officer with a restaurant. He is employed as the general manager. His paychecks are bouncing and his monthly expense reports have not been reimbursed for almost a year. His partners encouraged him to use his personal credit card to float the company and promised quick repayment. The debt (all unpaid wages and unpaid expenses) is now $100k. After the last two paychecks bounced, he started aggressively asking about plans for repayment. Another board member told us yesterday that the debt, which he referred to as a loan, would not be paid, that as a shareholder my husband could not \"make good on an obligation to himself\", that since my husband \"is the restaurant\" his resources basically belong to the business. For a time, they were paying $2k a month toward the debt, but no longer. Debt consolidation takes down the debt, but are there other advantages to bankruptcy? My husband seems to think he is exposed to IRS levies and the lease guarantee as an officer. The board member certainly alluded to as much - should he resign his position and will bankruptcy void any obligation in that area?
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