0
Bankruptcy Threshold Adjustment and Technical Corrections Act
12/29/2022, 11:03 PM
Summary of Bill HR 7494
The bill proposes to increase the debt threshold for individuals filing for bankruptcy from $394,725 to $425,000. This adjustment is intended to account for inflation and ensure that individuals who are struggling financially have access to bankruptcy protection when needed.
In addition to the threshold adjustment, the bill also includes technical corrections to the bankruptcy code. These corrections are aimed at clarifying and improving the bankruptcy process, making it more efficient and effective for both debtors and creditors. Overall, the Bankruptcy Threshold Adjustment and Technical Corrections Act seeks to modernize and improve the bankruptcy system in the United States. It is designed to provide relief to individuals facing financial hardship while also ensuring that the bankruptcy process is fair and transparent for all parties involved.
Congressional Summary of HR 7494
Bankruptcy Threshold Adjustment and Technical Corrections Act
This bill modifies provisions related to small business reorganization bankruptcies and wage earner's bankruptcies.
Specifically, the bill extends for two years the increase of the amount of debt allowed to be carried by debtors to qualify for small business reorganization bankruptcy and provides that this debt limit is subject to adjustment for inflation. Additionally, it provides that a small business debtor includes a debtor that is an affiliate of certain publicly traded companies. Further, it authorizes the bankruptcy trustee to operate the business of the debtor if the debtor ceases to be a debtor in possession.
The bill also increases for two years the debt limit for individuals filing for bankruptcy under Chapter 13 (i.e., the wage earner's plan) and allows both secured and unsecured debt to count towards this single limit. (Currently, separate limits apply to secured and unsecured debt.)
