CARES Act Bankruptcy Provisions Extended

On March 27, 2021, President Biden signed the “COVID-19 Bankruptcy Relief Extension Act of 2021” to extend the expiration dates of certain bankruptcy provisions of the CARES Act to March 27, 2022. The original version of the bill also included provisions to extend the expiration dates of certain bankruptcy provisions in the Consolidated Appropriations Act, this portion of the bill was not included in the final version.

Most importantly for small businesses is the proposed one-year extension of the increased $7.5 million debt limitation to file a small business chapter 11 case. Other provisions are primarily consumer in nature and relate to protecting COVID relief payments from creditors and provide additional relief to renters. A summary of the provisions to be extended (or not extended) are as follows:

An extension to the deadline for Second Draw Payment Protection Program funds was extended to May 31, 2021, with the SBA granted an additional 30 days to review applications received by May 31.