As the COVID-19 pandemic continues, more and more businesses are finding themselves in financial turmoil. Thankfully, many are eligible to file for relief under the Small Business Reorganization Act (SBRA), which has recently been improved by the Coronavirus Aid, Relief and Economic Security (CARES) Act.
During this time of economic uncertainty, our virtual chief financial officer, Marilyn Magett, has been asked on several occasions how the new amendments to this Act can help struggling business. So, we have included a brief overview of the Act along with qualification information here:
What is SBRA?
In 2019, The Small Business Reorganization Act was passed by Congress as an alternative to the standard Chapter 11 filing for small business debtors. This year the Act has been temporarily reimagined due to COVID-19. A new Subchapter V has been added and its key advantages include its more cost-effective nature and streamlined process.
Subchapter V requires that at least 50% of an applicant’s debt be attributed to commercial or business activity. Additionally, the debtor cannot be publicly traded, affiliated with an issuer, or have their principal activity be a single asset real estate operation. Until March, 2021, the CARES Act has temporarily increased the debt threshold from $2,725,625 to $7.5 million.
How Can We Help?
At Evolve our virtual chief financial officer, Marilyn Magett, is dedicated to offering the highest-level of strategic financial services. For decades she has helped clients discover the best restructuring option that meets their needs and successfully overcome any economic distress they are facing.
If you believe you are eligible for restructuring under the SBRA’s new Chapter V and are looking for more information or help with the process, our virtual chief financial officer, can be of great assistance.
Please contact us today at 1 (888) 400-2148 or schedule a free consultation.