There are three sections of the federal bankruptcy code that allow for reorganization, as opposed to liquidation. These are Chapter 13, Chapter 12, and Chapter 11. Chapter 13 provides individuals, married couples, and small businesses with a way to reorganize without having to liquidate assets to pay off creditors. Chapter 12 was designed to help family farmers. For those individuals and businesses who owe more than Chapter 13 allows, there's Chapter 11. Chapter 11 also provides for business to be reorganized, rather than liquidated, although businesses may be placed in Chapter 11 bankruptcy either voluntarily or involuntarily. The debtor may file a reorganization plan within 120 days after filing. The debtor may propose a reorganization plan outlining who the creditors are and how much they'll be paid. If the court finds that the plan is proposed in good faith and is reasonable and fair, it'll confirm the plan. If there's a trustee, the trustee may file the reorganization plan. After 120 days have passed, any creditor or other party may file its own reorganization plan. Reorganization may be a lesser evil for you than outright liquidation. For more information about whether a bankruptcy reorganization may be a good choice for you or your business, contact a bankruptcy attorney.