Discover the various types of bankruptcy.
A: Various forms of bankruptcy are available, and how they affect you will depend on your form of practice. If your practice is incorporated, as most larger practices are, the corporation itself could declare bankruptcy, but doing so would not necessarily mean that you would have to declare bankruptcy as an individual.
Most smaller practices, however, are operated as closely held businesses. In those cases, the doctor and his or her spouse usually personally guarantee the loans and thus are individually obligated to the lender, so declaring bankruptcy will not get them out of debt.
Send your money management questions to firstname.lastname@example.org. Answers to our readers' questions were provided by Medical Economics editiorial consultant David J. Schiller, Schiller Law Associates, Norristown, Pennsylvania.