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Virginia walk-in health clinics file Chapter 7 bankruptcy

In an economy that continues to struggle, small businesses are having a tougher time than ever staying afloat. Because consumers are spending less money, some businesses slip into debt. As this debt accumulates, it can be increasingly difficult to recover from. While it may seem like there is no way out, that is just not true. Filing for bankruptcy can offer a fresh start and significant debt relief for those in financial trouble.

A Chapter 7 bankruptcy petition was filed recently for a chain of Virginia, walk-in medical clinics. Medic 1 shut the last of its offices in May as it filed for bankruptcy protection. The court papers detailed the company's assets, valued at about $132,000. However, its liabilities exceed $2.5 million, according to the filing.

The creditors listed by the company in the bankruptcy filing include BB&T Bank and the Internal Revenue Service. Medic 1 reportedly has an IRS tax debt of almost $700,000 from 2009 and 2010. More taxes, in smaller amounts, are due to the state and the county of Spotsylvania. Utility companies, office landlords, insurance companies, and medical supply providers are also owed money by Medic 1.

The closing of Medic 1 was abrupt, although since its closure, the owner has established a new office not far from his previous clinic. The new facility offers the same types of walk-in health care services as Medic 1 did under the new name Towne Medical.

As we can see from this case, financial hardship often makes people choose which debts are most important to pay off and which to let accumulate. However, we can also see from this story that bankruptcy can be a good tool to help business get back on their feet. The owner of Medic 1 was able to open a similar clinic after filing bankruptcy. If you are facing the difficult situation of not being able to pay your debts, bankruptcy may be a good option.

Source: Fredericksburg.com, "Medic 1 workers will have to get in line," Jim Hall, July 26, 2011

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