Increased Debt Limit of $7.5 Million for Small Business Debtors Extended
President Biden on Saturday signed the COVID-19 Bankruptcy Relief Extension Act into law to extend provisions providing financially distressed consumers and small businesses greater access to bankruptcy relief. The legislation will extend personal and small business bankruptcy relief provisions that were part of last year’s CARES Act for an additional year through March 27, 2022. Perhaps the most significant bankruptcy-related provision of the CARES Act was the increased debt limit to $7.5 million for small business debtors electing to file under subchapter V. The CARES Act bankruptcy provisions were due to sunset on March 27, but the House of Representatives on Friday afternoon passed the Senate-amended version of H.R. 1651, the “COVID-19 Bankruptcy Relief Extension Act of 2021,” which passed by unanimous consent in the Senate on Wednesday. Dilworth’s bankruptcy and insolvency group is actively involved in SBRA issues.