Is the most versatile chapter in the Bankruptcy Code. Chapter 11 provides myriad choices to reorganize debt. Under a chapter 11 a company or individual may repay some debts, discharge other debts, and restructure the debts remaining. Individuals may file for Chapter 11, however the high cost of filing fees and administrative costs encourage most individuals to file bankruptcy under chapters 7 and 13.
Chapter 11 bankruptcy is by far the most expensive to file. It has been prohibitively expensive for smaller firms in the past. Under the Small Business Reorganization Act, which passed in February of 2020, congress streamlined the process for small businesses hoping to use bankruptcy as a means to a fresh start. They created a new subchapter to Chapter 11 bankruptcy filings, called Subchapter V. They capped this stream-lined process for companies that were holding less that $2.7 million in debt.