President Biden Extends Parts of the CARES Act

 

President Joe Biden signed the “COVID-19 Bankruptcy Relief Extension Act” into law to extend provisions providing financially distressed consumers and small businesses greater access to bankruptcy relief. The legislation extended personal and small business bankruptcy relief provisions that were part of the CARES Act through March 27, 2022. 

The is significant, especially for small businesses electing to file under subchapter V.  See H.R. 1651; however, the “Consolidated Appropriations Act of 2021” (CAA) was not extended.

Other bankruptcy provisions extended to 2022 by the COVID-19 Bankruptcy Relief Extension Act include:

• Amending the definition of “income” in the Bankruptcy Code for chapters 7 and 13 to exclude coronavirus-related payments from the federal government from being treated as “income” for purposes of filing bankruptcy.
• Clarifying that the calculation of disposable income for purposes of confirming a chapter 13 plan shall not include coronavirus-related payments.
• Explicitly permitting individuals and families currently in chapter 13 to seek payment plan modifications, including extending their payments for up to seven years.

If you find yourself either experiencing financial difficulties, or foresee the possibility of financial difficulties, as a result of the pandemic, you should seek the advise of a competent bankruptcy professional in your area that can help you come up with a financial game plan moving forward.