March 31, 2022

Subchapter V Debt Limit Reverts to Lower Amount

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In March of 2022, the House passed a bill that would have extended for an additional year the increased debt-eligibility limit for Subchapter V of Chapter 11.¹

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It was hoped that the bill would be passed before the sunset date of March 27, 2022, so that even more struggling, debt-laden businesses could continue to access the streamlined, more affordable, Subchapter V process. But the Senate failed to address the matter before March 27, 2022, the threshold reverted back to its lower amount, and now only those businesses with less than $2,725,625.00 in debt qualify for the Subchapter V process.

Congress still appears to be working on this issue, and we will keep you up-to-date as developments and opportunities arise.

Footnotes

  1. You can read more about the Subchapter V process on our website.
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