Bill would raise debt limits for small business and Chapter 13 bankruptcy
Passed one chamberS. 3977Latest action
Sponsor: Chuck Grassley · Senator · IA
AIDecoded by AI · checked against the recordRead the official text
Official title: Bankruptcy Threshold Adjustment Act of 2026
119th Congress
Topics: Jobs & the economy
Introduced:
Read the official bill on Congress.govIn plain words
The plain-language version comes first. The official text is always the reference.
The bill raises debt caps so more small businesses and individuals qualify for faster, simpler bankruptcy options.
35-second read · 4 questions answered below
What does this do?
The bill raises the debt cap for the streamlined "Subchapter V" small business bankruptcy process to $7,500,000, while excluding SEC-reporting companies and their affiliates. It also raises the Chapter 13 individual debt limit to a single combined threshold of $2,750,000, replacing separate secured and unsecured debt limits. These changes apply only to bankruptcy cases filed after the bill becomes law.
Who does it affect?
Small business owners and individuals (or married couples) considering bankruptcy filings are directly affected.
Why does it matter?
Higher debt limits would let more businesses and individuals use faster, less complicated bankruptcy processes instead of complex Chapter 11 proceedings. Cases already underway would not be affected by the change.
AI-drafted summary. Check it against the official text before you act on it.
Read the official bill on Congress.govMake the call
Where does it stand?
- IntroducedMar 3, 2026
- Senate committee
- Senate vote
- HouseYou are here · Aug 10, 2026
- The president's desk
Right now: it passed the Senate, and the official record shows nothing new since. If the House changes it, it goes back to the Senate before reaching the president.
Latest action: — Held at the desk.