Bankruptcy Threshold Adjustment and Technical Corrections Act

To amend title 11, United States Code, to modify the eligibility requirements for a debtor under chapter 13, and for other purposes. 1. Short title This Act may be cited as the Bankruptcy Threshold Adjustment and Technical Corrections Act 2. Bankruptcy amendments (a) CARES Act amendment Section 1113(a) of the CARES Act ( Public Law 116–136 (b) Definition of small business debtor Section 101(51D)(B)(iii) of title 11, United States Code, is amended by striking an issuer a corporation described in clause (ii). (c) Adjustments for inflation (1) In general Section 104 of title 11, United States Code, is amended— (A) in subsection (a), by inserting 1182(1), 707(b), (B) in subsection (b), by inserting 1182(1), 707(b), (2) No adjustments in 2022 With respect to the adjustment of dollar amounts required on April 1, 2022, under section 104 of title 11, United States Code, as amended by paragraph (1), the Judicial Conference of the United States shall not adjust the dollar amount in effect under section 109(e) or 1182(1) of title 11, United States Code. (d) Who may be a debtor under chapter 13 Section 109 of title 11, United States Code is amended by striking subsection (e) and inserting the following: (e) Only an individual with regular income that owes, on the date of the filing of the petition, noncontingent, liquidated debts of less than $2,750,000 or an individual with regular income and such individual’s spouse, except a stockbroker or a commodity broker, that owe, on the date of the filing of the petition, noncontingent, liquidated debts that aggregate less than $2,750,000 may be a debtor under chapter 13 of this title. . (e) Definition of debtor Section 1182(1)(B) of title 11, United States Code, is amended— (1) in clause (i), by inserting under this title affiliated debtors (2) in clause (iii), by striking an issuer a corporation described in clause (ii). (f) Trustee Section 1183(b)(5) of title 11, United States Code, is amended— (1) by striking possession, perform (A) perform ; (2) in subparagraph (A), as so designated— (A) by striking , including operating the business of the debtor (B) by adding and (3) by adding at the end the following: (B) be authorized to operate the business of the debtor; . (g) Confirmation of plan Section 1191(c) of title 11, United States Code, is amended by striking paragraph (3) and inserting the following: (3) (A) The debtor will be able to make all payments under the plan; or (B) (i) there is a reasonable likelihood that the debtor will be able to make all payments under the plan; and (ii) the plan provides appropriate remedies, which may include the liquidation of nonexempt assets, to protect the holders of claims or interests in the event that the payments are not made. . (h) Technical corrections to the Bankruptcy Administration Improvement Act Section 589a of title 28, United States Code is amended— (1) in subsection (c) by striking subsection (a) subsections (a) and (f) (2) in subsection (f)(1)— (A) in the matter preceding subparagraph (A), by striking subsections (b) and (c) subsection (b)(5) (B) in subparagraph (A), by inserting needed to offset the amount amounts

Summary: 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.)