Durbin, Grassley: Bipartisan Legislation to Extend CARES Act Bankruptcy Relief Provisions Heads to President
WASHINGTON – U.S. Senate Majority Whip Dick Durbin (D-IL), Chair of the Senate Judiciary Committee, and U.S. Senator Chuck Grassley (R-IA), Ranking Member of the Senate Judiciary Committee, today applauded final passage of the COVID-19 Bankruptcy Relief Extension Act, bipartisan legislation they introduced to temporarily extend COVID-19 bankruptcy relief provisions enacted as part of the March 2020 CARES Act. The bill now heads to President Biden for signature.
“Extending these temporary bankruptcy provisions until March 2022 provides vital relief to families and small businesses facing hardships during this pandemic. I’m glad we got this done on a bipartisan basis to help Americans in need,” Durbin said.
“As businesses and individuals continue to struggle with the economic challenges of the ongoing pandemic, Congress is committed to providing the tools and flexibility for them to once again be successful. Last year, we passed temporary bankruptcy relief provisions to help those facing bankruptcy during the pandemic. This included increasing limits in my 2019 bill to streamline bankruptcy laws for small businesses. This bill extends that relief for an additional year,” Grassley said.
The bill extends for an additional year CARES Act bankruptcy provisions that are set to expire tomorrow. These provisions do the following:
· Allow more small businesses to file for streamlined Chapter 11 bankruptcy proceedings underGrassley’s Small Business Reorganization Act of 2019 by increasing the maximum debt limit for those procedures from $2.7m to $7.5m.
· Amend the definition of income for Chapters 7 and 13 (which govern individual bankruptcy filings) to exclude federal COVID-related relief payments from being treated as “income” for purposes of filing bankruptcy.
· Clarify that the calculation of disposable income for purposes of confirming a Chapter 13 plan does not include COVID-related relief payments.
· Permit individuals and families in Chapter 13 to seek payment plan modifications for plans confirmed before the date of enactment of this extender bill if they are experiencing a material financial hardship due to the coronavirus pandemic.
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