Even if your small business is filing for bankruptcy, there may still be some debts you’ll need to repay. And who you’ll need to repay — and who you’ll need to repay first — will depend on how your creditors are classified. By the same token, if a client or customer is declaring bankruptcy, there’s still a chance you’ll get paid. And whether — and when — you’ll get repaid will also depend on how your small business is classified as a creditor.
Therefore it’s important to understand some bankruptcy terms from both sides of the coin.
