Chapter 13 Bankruptcy Definition

Short Definition
Chapter 13 bankruptcy is a court-approved repayment plan for individuals or sole proprietorships (the individual and business are the “same entity”) who are unable to pay creditors.

Expanded Definition
Chapter 13 bankruptcy’s repayment plan can enable a sole proprietor to repay debt over a specific time period. With Chapter 13’s court-approved plan, the individual’s business and personal assets can be protected.

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