As of June 21, 2024, the debt limit for small business bankruptcies, also known as Subchapter V bankruptcies, reverted to $3,024,725 from the temporarily increased limit of $7,500,000 established under the Coronavirus Aid, Relief, and Economic Security Act (CARES Act). This reversion limits small and midsize businesses’ access to a streamlined and cost-effective alternative to traditional Chapter 11 filings, potentially leading to broader financial implications.

Background on Subchapter…