Small businesses hit by the record flooding in our state may be at risk for insolvency. In my earlier bankruptcy blog, Floods Of Trouble Can Cause Bankruptcies In Indiana, I explained that, if a business is structured as a corporation or LLC, the business itself can file bankruptcy independent of the owner. On the other hand, sole proprietorships and partnerships would have only the option of individual bankruptcy.

Meanwhile, for business flood victims, the U.S. Small Business Administration is offering two types of loans that might help at least some business stave off bankruptcy. First, Physical Disaster Loans of up to $1.5 are available to repair or replace damaged real estate property, but also equipment and inventory. Second, Economic Injury Disaster Loans, also in amount up to $1.5 million, can help meet expenses the business would have paid had the disaster not happened. Both types carry interest rates no higher than 4%. The phone number of the SBA is 1 800 659 2955, and the website is

While the level of flooding in Indiana this year was greater than for the past half-century, I, as a small business bankruptcy attorney in Indiana for almost half that time, have worked with hundreds of small businesses hit by storms, flooding, and fire during that time. My advice for all business owners remains the same: Begin just as soon as possible after the disaster to assemble your “comeback team”, including your insurance professional, representatives of the SBA and other agencies that can help, and a bankruptcy attorney. This is one time where a bankruptcy attorney may actually be the best person to help a business avoid bankruptcy, by coordinating negotiations with creditors and by providing critical legal advice.