QUESTION

Can I pay the bills for my nonprofit out of the nonprofit bank account without it affecting my bankruptcy filing?

Asked on Nov 21st, 2014 on Bankruptcy - Ohio
More details to this question:
I'm filing personal bankruptcy. The nonprofit will not be considered one of my assets when I file. I do have a few hundred dollars in the business account and owe money for business related expenses. I will probably be filing personal bankruptcy in the next two weeks.
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6 ANSWERS

Bankruptcy Attorney serving Las Vegas, NV
2 Awards
That would be a yes.
Answered on Aug 31st, 2015 at 8:42 PM

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Assuming the Non Profit is NOT your asset, you are free to pay business expenses.
Answered on Nov 24th, 2014 at 5:24 PM

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IF the nonprofit is a separate legal entity (e.g. an LLC or a corporation) then it is a separate entity, and it can pay its bills without raising a problem for your personal bankruptcy. In a situation like yours, however, you would benefit from retaining an experienced bankruptcy lawyer. Good Luck.
Answered on Nov 24th, 2014 at 5:24 PM

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Bankruptcy Attorney serving Las Vegas, NV at A Fresh Start
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Is the nonprofit a corporation or other separate entity? If it is, then the financial transactions of the nonprofit have nothing to do with your bankruptcy.
Answered on Nov 24th, 2014 at 5:24 PM

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Commercial & Bankruptcy Law Attorney serving Powell, OH at Ronald K. Nims
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My wink, wink nonprofit? If you're filing bankruptcy sound like your business was an actual unprofitable nonprofit, if your business model failed despite all the tax exemptions, you better find a new nonprofit to exploit. You can't own a nonprofit, in theory they are owned by society and run for the benefit of the community - that's a laugh. Since the nonprofit is a separate entity which you don't own, the business bills can be paid out of the business account. However, if, like many nonprofit "owners", you have been plundering the business funds to pay your personal bills, this can come out in a bankruptcy and you might have tax and criminal problems.
Answered on Nov 24th, 2014 at 2:16 AM

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As long as the finances are properly segregated and documented, you should be able to carry on the nonprofit affairs without affecting your personal bankruptcy. You may have to disclose what those expenses were, but as long as they are legitimate, there will be no problem.
Answered on Nov 24th, 2014 at 2:16 AM

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