10.8.2019 | Articles / Publications
“New Bankruptcy Laws Expand Relief for Small Companies, Farmers and Veterans,” Orlando Business Journal
In an article published on October 8, 2019 in the Orlando Business Journal, Jonathan Sykes highlights recently signed legislation that will expand bankruptcy relief significantly for farmers, veterans and small businesses.
Sykes details the Family Farmer Relief Act of 2019, the Honoring American Veterans in Extreme Need Act of 2019 (HAVEN Act) and the Small Business Reorganization Act of 2019 – all signed on August 23, 2019 – and how these new laws will affect practitioners.
Congress more than doubled the debt ceiling for a “family farmer” under the bankruptcy code, increasing the number of farmers eligible to reorganize under Chapter 12; and similarly, for veterans and their families, Congress expanded access to relief in a reorganization case under Chapter 13 by shielding veteran disability payments.
“The most significant change for small business debtors includes the elimination of the absolute priority rule, which prohibits individuals from retaining non-exempt assets, and business owners from retaining equity, unless all creditors are paid in full,” he states.
According to Sykes, these new laws will provide greater access to bankruptcy relief. Therefore, practitioners should be aware of how these changes affect clients who may now have access to bankruptcy relief that previously was unavailable or unaffordable.
Subscribers to the Orlando Business Journal may access the full article online here.