The U.S. District Court for the Middle District of Florida is the nation's busiest jurisdiction for Subchapter V bankruptcy filings. Credit: Google Recently Created Bankruptcy Option for Small Businesses Gets Restricted After Sunset Period Ends
In 2019, the federal government created the Subchapter V bankruptcy filing option, which helped small businesses go through bankruptcy much quicker and with less fees. But after the U.S. Senate failed to pass a bill on Friday, the number of businesses that can qualify shrunk.
June 24, 2024 at 05:31 PM
3 minute read
What You Need to Know
- After years of rising popularity, it just got harder to qualify for the recently created Subchapter V bankruptcy option.
- The option was created to help small businesses in distress file for bankruptcy quicker and cheaper.
- The debt limit for businesses applying was $7.5 million, but after the U.S. Senate let that threshold expire, it's now $2.7 million.
After its inception in 2019, the Subchapter V bankruptcy filing option exploded in popularity, particularly in Florida, but it just got harder for small businesses to qualify for it.
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