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DISTRESSED DAILY: Tiny Bankrupt Firms Win More Legal Flexibility

March 30, 2021, 12:08 PM

In a win for Covid-hit small businesses, President Joe Biden extended a crucial debt-limit rule that soothes the pain of bankruptcy for firms with relatively light debt loads.

Biden on Saturday signed a bill that lets companies with less than $7.5 million of debt continue to take advantage of regulations that speed up bankruptcies and make them cheaper. Before Congress raised the limit last year, the rules were reserved for firms with about $2.7 million of debt or less.

The Covid-19 Bankruptcy Relief Extension Act of 2021 pushes the expiration of the higher debt limit for a year to March ...

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