Subchapter V marries the flexibility and power of Chapter 11 with the cost control of Chapter 13 for those whose debts are primarily from business transactions. It became effective in February 2020, and the debt limits were recently raised to $7,500,000. If you have business debt in this range, even if you are not currently in business, Subchapter V relief may be available to you.
Subchapter V allows you to file a Chapter 11 Plan, but the disclosure of relevant facts is contained in the plan, not a separate disclosure statement that invariably draws objections. The process is streamlined, simplified and more cost effective. It eliminates the absolute priority rule which means the debtor does not have to supply new value in order to keep his or her property in the end. It can eliminate or reduce trustee fees, and your attorney's fees.
Most importantly, you remain in control of your business and your assets subject to the rules of bankruptcy. You have a better path to the future for you and your business. Call The Law Office of Richard T. Baum today for more information about Subchapter V bankruptcy relief. We proudly serve Los Angeles, CA!