HB7730, the Bankruptcy Threshold Adjustment Act of 2026, would raise the debt limits that determine eligibility for two bankruptcy pathways under federal law. For small-business bankruptcy under Subchapter V, the bill increases the maximum aggregate noncontingent liquidated secured and unsecured debt from the current level to $7.5 million, while preserving existing exclusions for certain single-asset real estate businesses, publicly reporting companies, and affiliates of those companies. It also maintains the requirement that at least half of the debt arise from commercial or business activities.
For consumer bankruptcy, the bill amends Chapter 13 eligibility so that an individual with regular income, or a married couple filing jointly, may qualify if their noncontingent, liquidated debts total less than $2.75 million. The bill leaves in place the exclusion of stockbrokers and commodity brokers. The changes would apply only to bankruptcy cases filed on or after the date of enactment.
Impact
The bill would amend Title 11 of the U.S. Code, specifically sections governing eligibility for Subchapter V small-business bankruptcy and Chapter 13 consumer bankruptcy. By increasing debt thresholds, it would expand access to these bankruptcy options for larger small businesses and higher-debt individuals, potentially allowing more debtors to reorganize under these chapters rather than being forced into other bankruptcy provisions. The bill would not change discharge rules directly, but it would broaden the class of debtors eligible to seek relief under the amended chapters.
Sentiment
The available legislative history suggests a generally favorable and noncontroversial committee reception. The bill was ordered to be reported by voice vote, which typically indicates broad agreement and no recorded opposition in committee. No floor debate, recorded votes, or committee transcript excerpts are provided, so the public record here shows support at least at the committee stage and no evident partisan split in the available materials.
Contention
The main policy issue is the size of the eligibility increase and who should benefit from expanded bankruptcy access. Supporters are likely to view the higher thresholds as a modernization of outdated debt caps that would better reflect current business and consumer debt levels and preserve reorganization options for financially distressed debtors. Potential concerns would center on whether the higher limits could allow larger or more sophisticated debtors to use bankruptcy chapters intended for smaller businesses or ordinary wage earners, and whether the exclusions for public companies, affiliates, and certain real-estate entities are sufficient to prevent abuse. No specific objections are documented in the provided materials.