U.S. Sens. Sheldon Whitehouse (D-RI), Dick Durbin (D-IL), Chuck Grassley (R-IA), and John Cornyn (R-TX) recently applauded the enactment of their legislation that aids small businesses and individuals amid navigating bankruptcy.
The bill advanced through the Senate with unanimous support.
“The bankruptcy process should help small businesses and working families to weather financial hardship and emerge stronger,” Whitehouse said. “This new law will help them do that,” said Whitehouse. I’m gratified to see President Biden sign this bipartisan effort. I was pleased to work with Sens. Grassley, Durbin, and Cornyn to improve our bankruptcy process.”
The CARES Act of 2020 temporarily allowed a greater number of small businesses to qualify for streamlined procedures by increasing the upper debt limit for small businesses from $2.7 million to $7.5 million. The increase expired on March 27, 2022.
The newly enacted legislation allows a two-year extension to the CARES Act increase while addressing minor technical fixes to the Small Business Reorganization Act.
Additionally, the new law increases the debt limit for individuals to qualify for Chapter 13 bankruptcy for two years, allowing individuals an opportunity to try to save their homes from foreclosure.
“As American families and small businesses face mounting economic uncertainty amid historic inflation and spiking interest rates, it’s more important than ever that we remove hurdles to reorganizing when folks fall on hard times,” Grassley said. “Our bipartisan bill – now law – builds on my Small Business Reorganization Act in 2019 with Sen. Whitehouse to streamline the bankruptcy process for small businesses by eliminating onerous paperwork requirements designed for major corporations.”