While there is no requirement that both a business and personal bankruptcy be filed, in many instances, it is desirable to do so.  Much of the decision is determined by whether business debts have been individually guaranteed, thus spreading the business debts over to the individual.  This is a very common situation with small businesses.  On the contrary, sometimes it makes more sense to just file a personal bankruptcy and then stop operating the business under the corporate entity.  Many people start a new business after they file personal bankruptcy and essentially do the same type of work.  This can be a very effective way to get a fresh start.