The Senate has recently passed a Coronavirus Stimulus Bill providing greater access to bankruptcy relief for distressed consumers and small businesses. The Coronavirus Aid Relief and Economic Security Act (CARES Act) will give financially distressed consumers greater access to bankruptcy relief.
Key bankruptcy provisions within the CARES Act include:
- Amending the small business reorganization act to increase the eligibility threshold for businesses filing bankruptcy.
- Amending the definition of “ income” in the bankruptcy code for Chapter 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 if they are expecting a material financial hardship due to the Coronavirus pandemic including extending their payments for up to seven years after the initial payment was due.
Closed Businesses – Lost Jobs
Many businesses are closing or operating at minimum staff. Some employees are fortunate enough that they can perform their work from home. Others are not so lucky and have lost their jobs or have had their hours severely cut. People who are already tight on their finances may be worried about how they’re going to feed themselves and their families over the coming months.
If you are experiencing financial hardship due to losing your job or having your hours cut back, contact a Houston bankruptcy attorney to find out how to get financial relief for you and your family.