• Posts by Shantal Malmed
    Associate
    | 310.281.6314

    Shantal Malmed is an Associate in ECJ’s Receivership, Bankruptcy, and Creditors’ Rights Services Department. Her practice focuses on complex insolvency and fiduciary matters, including receiverships, bankruptcy ...

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Senate Passes Bill to Permanently Raise Subchapter V Debt Ceiling – What It Means for Small Businesses | By: Shantal Malmed
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Senate Passes Bill to Permanently Raise Subchapter V Debt Ceiling – What It Means for Small Businesses | By: Shantal Malmed

On August 3, 2026, the U.S. Senate voted unanimously to pass S. 3977, the Bankruptcy Threshold Adjustment Act of 2026. The bill has had bipartisan support since it was introduced in March 2026. The bill would permanently restore the Subchapter V debt ceiling to $7.5 million for qualifying small businesses and individuals filing for reorganization under Chapter 11.

A Quick Refresher on Subchapter V

Congress created Subchapter V in February 2020 through the Small Business Reorganization Act (“Act”), giving smaller companies a leaner, less expensive path through Chapter 11 than ...

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