Subchapter V Bankruptcy Updates

 A Bloomberg article https://news.bloomberglaw.com/bankruptcy-law/senate-proposal-would-grow-...
eligibility  is reporting that a new Senate proposal aims to increase the debt limits for Subchapter V bankruptcy eligibility for
small businesses. This proposal would restore the higher debt limit of $7.5 million for Subchapter V filings, up from the current
limit of about $3 million. The expansion would allow more businesses to take advantage of Subchapter V's benefits, which
include a more streamlined and cost-effective restructuring process compared to traditional Chapter 11 bankruptcies.

The potential revival of the higher debt limit comes after a significant drop in small business bankruptcy filings following the
expiration of the previous $7.5 million threshold.

Subchapter V, introduced in 2019, initially applied to businesses with less than $2.7 million in debt but was expanded to $7.5
million in 2020 as part of COVID-era business relief. This expansion was extended in 2022 but eventually expired, reverting
the eligibility requirement to about $3 million.

We are monitoring these developments and will continue to report on updates to Subchapter V. 

We help individuals and businesses who have too much debt!Jim Shenwick, Esq  917 363 3391  [email protected] 
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