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119-s-3977119th CongressWALLET

Bankruptcy Threshold Adjustment Act of 2026

Sponsored By: Senator Grassley, Chuck [R-IA]

Passed Senate

Summary

Raises eligibility debt thresholds for small-business Chapter 11 and individual Chapter 13 filings and sets clear exclusions and a prospective effective date. This bill would change who can use these bankruptcy chapters by changing the dollar cutoffs and which debts count.

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Bill Overview

Analyzed Economic Effects

2 provisions identified: 0 benefits, 0 costs, 2 mixed.

New debt cap for Chapter 13 filers

You would be able to use Chapter 13 only if you have regular income and, on the filing date, your noncontingent, liquidated debts total less than $2,750,000. Married couples would be able to file a joint Chapter 13 only if their combined noncontingent, liquidated debts are under $2,750,000. A spouse who is a stockbroker or a commodity broker would be excluded from joint filing. These rules would apply to cases filed on or after the date of enactment.

Debt cap for small-business Chapter 11

To use the small-business Chapter 11 path, your total noncontingent, liquidated debts would need to be no more than $7,500,000 as of filing (or the order for relief). Debts owed to affiliates or insiders would not count toward the cap. At least 50% of the counted debts would need to come from your commercial or business activities. You would be excluded if your primary business is owning single-asset real estate, if your affiliated group’s combined debts exceed $7,500,000, or if you are an SEC-reporting corporation (or its affiliate). These rules would apply to cases filed on or after the date of enactment.

Sponsors & CoSponsors

Sponsor

Grassley, Chuck [R-IA]

IA • R

Cosponsors

  • Sen. Durbin, Richard J. [D-IL]

    IL • D

    Sponsored 3/3/2026

  • Sen. Cornyn, John [R-TX]

    TX • R

    Sponsored 3/3/2026

  • Sen. Whitehouse, Sheldon [D-RI]

    RI • D

    Sponsored 3/3/2026

  • Sen. Graham, Lindsey [R-SC]

    SC • R

    Sponsored 3/3/2026

  • Sen. Coons, Christopher A. [D-DE]

    DE • D

    Sponsored 3/3/2026

Roll Call Votes

No roll call votes available for this bill.

View on Congress.gov
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