Alachua: 352‑225‑3920 | Broward: 954‑423‑4469
Alachua: 352‑225‑3920 | Broward: 954‑423‑4469
Serving Northern, Middle & Southern Districts Of Florida

Introduction to Small Business Reorganization Act

Last Updated: Friday, April 24, 2020

Effective February 19, 2020, the Small Business Reorganization Act (SBRA) provides a simple, affordable, and effective way for small businesses to restructure. In recognition of the terrible effects that COVID-19 is having on our economy, Congress has temporarily increased the debt limit for business to file under the SBRA. The CARES Act makes businesses or business owners' who have under $7,500,000.00 eligible for the streamlined process under the SBRA.

Among the cost-saving provisions of the SBRA are:

  • Streamlined process where the court must hold a status conference within 60 days and a reorganization plan must be filed within 90 days. This is in comparison to roughly a year in a traditional Chapter 11.
  • Business owner can retain control of the company and receive a discharge of business debts if all disposable income of business is paid for three years. Business owner can still pay himself or herself a reasonable salary and benefits during this period.
  • Allows modification of mortgage on owner's primary residence if the funds were used to fund the operations of a small business.
  • Significantly lower administrative expenses in comparison to a traditional Chapter 11. There are no quarterly fees to the United States Trustee Program, a savings of tens of thousands of dollars over the course of a normal file, and other administrative expenses including legal fees are greatly reduced by the streamlined process.

These provisions make the Chapter 11 reorganization process more accessible and affordable for small businesses without the economic resources to absorb the more cumbersome aspects of a larger Chapter 11 case. The SBRA provides a pathway for small businesses to restructure from the extraordinary strain caused by COVID-19 and the associated economic damage.

With over 70 years of combined bankruptcy and restructuring experience, the Salkin Law Firm is able to assist you in restarting your business and resolving your debt. For more information, please contact Sonya Salkin Slott at or by phone at 954-423-4469 or 352-225-3920.