On June 21, 2022, the “Bankruptcy Threshold Adjustment and Technical Corrections Act” (BTATC) (Pub. L. No. 117-151) was signed into law by the President. The BTATC includes three major provisions:
- Extends for two years the increase of the amount of debt (up to $7,500,000) allowed to be carried by debtors to qualify for small business reorganization under subchapter V (applies retroactively to cases commenced on or after March 27, 2022, and with respect to a case that was commenced on or after March 27, 2020, and before June 21, 2022, is pending on June 21, 2022),
- Increases, for two years, the debt limit for individuals filing for bankruptcy under Chapter 13 (to less than $2,750,000) and allows both secured and unsecured debt to count towards this single limit (effective June 21, 2022), and
- Provides technical amendments to the BAIA (to 28 U.S.C. § 589(a) specifically), which are effective as of October 1, 2021.
Additionally, the BTATC reinstates the definition of “debtor” for determining eligibility to proceed under subchapter V chapter 11 that was in effect from March 27, 2020 to March 27, 2022. As a result, Line 13 of Official Form 101, and Line 8 of Official Form 201, have been updated to reflect the change.