In 2016, I made a series of hasty startup decisions to put large business purchases on my personal credit cards - that's around 80% of my current $150k in open credit card debt.
For the most part, needing to meet with potential cofounders, investors, while building the entire thing myself took up most if not all of my time. I've hastily incorporated a 1-person Delaware C Corp in 2015 though did not have time to look into setting up a separate bank account. To be honest, much of what I did should probably have been done while being employed as a research engineer/scientist at a big company - but having won a few key awards, I naively set out to try my own startup.
I'm able to justify the big expenses as legitimate business expenses. I've been very hasty on tax forms the past few years and just added them to the Schedule C. (The complication is that these were purchased on credit card.)
I'm trying to evaluate my options currently:
- I'm considering just joining a big company as a employee. Sadly, the primary reason for this would be to pay off business debt over time. (And I would be worried that I would no be able to afford to pay taxes next year if I tried paying my debt off the first year.)
- There's considerable (or at least high potential) value in the technology I have created. I'm considering re-incorporating as one or more new entities - this time with better understanding of how business works. Each new entity would take on part of the debt.
My question: What would be the best way to deal with high credit card debt incurred for a business you tried to start, but did not exactly succeed in?
(Note - For the most part, albeit not employed by the usual large company, I'm a very frugal person - I usually break even or profit slightly on personal expenses: get travel covered to speak as a specialist at a conference, stay for free among Esperantists and friends, etc., or burn hotel points - which I accumulate from travel covered as contractor when I'm building technology for industry events. Also, a keen travel hacker, having done the whole credit card benefits thing moderately, back when I still had good credit.)