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Bankruptcy Legislation Litigation

There Is No Post-Confirmation True-Up of Projected Disposable Income In Subchapter V

A large number of reported decisions interpreting Sub V have mostly addressed the eligibility threshold for a debtor to proceed under the new law. And legitimate questions will continue to present themselves. Such is the nature of most new (and even not-so-new) statutes.


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Congress created Subchapter V of Chapter 11 (Sub V) of the Bankruptcy Code to help small business debtors (companies and individuals) complete traditional reorganizations in Chapter 11. It is no secret that Chapter 11, over the years, evolved to be an expensive and uncertain remedy for those seeking its relief, especially smaller debtors. Moreover, the sale of substantially all of a debtor’s assets outside the context of a Chapter 11 plan went from being the exception, in the early 1980s, to the rule today.

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