Looking For Cover
Struggling small businesses could be out in the cold if a bankruptcy reform bill passes.
Emerging from Chapter 11 bankruptcy will be more difficult for entrepreneurs if Congress passes the bankruptcy reform bill it's considering. Both House and Senate versions of the bill would establish a 150-day deadline for a small business to complete a business reorganization plan and have it approved by a federal bankruptcy judge. Currently, there is no deadline.
If a small business were unable to meet that 150-day time frame, it could apply for an extension. But the Senate bill says the entrepreneur would have to show "clear and convincing" evidence that he or she could get the business back on its feet. The House bill requires a "preponderance of evidence."
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