Biden signs Grassley-led bankruptcy bill

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WASHINGTON- President Joe Biden today law signed a bipartisan law written by Sen. Chuck Grassley (R-Iowa) to help small businesses and individuals stay afloat during bankruptcy. That Insolvency threshold adjustment and technical correction law (p. 3823) becomes law at a time when Americans are grappling with 40-year-high inflation, rising interest rates and fears of a looming recession. As the senior member of the Judiciary Committee, Grassley worked with Sens. Sheldon Whitehouse (DR.I.), Dick Durbin (D-Ill.), and John Cornyn (R-Texas) to advance the bill, which was unanimously approved and passed by the Senate House of Representatives with an overwhelming bipartisan vote of 392-21.

“As American families and small businesses face mounting economic uncertainty in the face of historic inflation and rising interest rates, it’s more important than ever that we remove roadblocks to restructuring when times are tough for people. Our bipartisan bill – now law – builds on mine Small Business Restructuring Act 2019with Sen. Whitehouse to streamline the bankruptcy process for small businesses by eliminating cumbersome paperwork requirements for large corporations,”
said Grasley.

“The bankruptcy process should help small businesses and working families weather financial difficulties and emerge stronger. This new law will help them do that. I am pleased that President Biden is signing this bipartisan initiative. I have been pleased to work with Senators Grassley, Durbin and Cornyn to improve our bankruptcy process.” said Weisshaus.

“Too many corner shops fall into a complicated bankruptcy regime while working to get back on their feet. At the same time, many families are struggling with an overwhelming burden of debt. This bipartisan bill brings relief to both. I am grateful to my Senate colleagues for their partnership on this critical legislation, and applaud President Biden for acting quickly to sign this into law – a testament to this Congress and Administration’s commitment to supporting American businesses and families. ” said Durbin.

“For small businesses and families who have struggled through the pandemic and are now in economic distress, our complicated bankruptcy process can be another hurdle to survive. I’m glad we were able to come together on this breather from stressful demands, especially given record high inflation and rising interest rates.” said Cornyn.

Whitehouse and Grassley stopped by Small Business Restructuring Act in 2019 to introduce streamlined bankruptcy procedures to help small business owners keep their businesses afloat and preserve jobs. The CARES Act of 2020 temporarily allowed more small businesses to qualify for these simplified procedures by raising the small business debt ceiling from $2.7 million to $7.5 million. This increase expired on March 27, 2022.

That Insolvency threshold adjustment and technical correction law, which is now law, provides a two-year extension of the CARES Act increase to $7.5 million and makes minor technical fixes to the Small Business Reorganization Act. It also raises the debt limit for individuals who qualify for Chapter 13 bankruptcy for two years, giving more individuals the opportunity to try to save their homes from foreclosure.

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