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Small business cases

Official Procedure Last Change July 15, 2021

Small business cases

  • 11 USC 101(51c), (51d), 308(b), 1102(a)(3), 1116, 1121(e), 1125(f), 1129(e)
  • FRBP 1020, 3017.1
  • S. D. Ind B-3017-2

General Information

Any individual or non-individual Chapter 11 debtor who satisfies the definition of “small business debtor” can request to be treated as a small business case. Determination of whether a debtor is a "small business debtor" requires application of a two-part test:

  • The debtor must be engaged in commercial or business activities (other than primarily owning or operating real property) with total non-contingent liquidated secured and unsecured debts of $2,490,925 or less.
  • The debtor's case must be one in which the U.S. trustee has not appointed a creditors' committee, or the court has determined the creditors' committee is insufficiently active and representative to provide oversight of the debtor.

Small business cases are overseen more directly by the U.S. Trustee, and generally proceed more quickly than non-small business cases. Any party can ask the court to order that a creditors’ committee not be appointed.

The following apply to small business cases:

Required documents

The following are required to be filed on small business cases, either along with the filing of the petition or 14 days after:

  • Balance sheet
  • Cash flow statement
  • Tax returns
  • Statement of operations

The deadline for filing these can be extended by means of a Motion to Extend Time to File Schedules. If one or more of these documents is unavailable, the debtor must file a statement in lieu.

Deadline for filing initial case documents

If a Motion to Extend Time to File Schedules is filed, the maximum extension allowed by law is a total of 30 days from the date of filing of the petition, not 45 days as is allowable for non-small business cases.

Plans and disclosure statements

The plan and disclosure statement process can be streamlined. Consult Fed.R.Bankr.P. 3017.1 and S. D. Ind B-3017-2. If the debtor wishes to use one of the streamlining options, a Notice of Proposed Expedited Processing of Small Business Chapter 11 Plan must be filed. This Notice is not required to be filed in Subchapter V cases, and disclosure statements do not apply.

Deadlines related to the filing and confirmation of the plan in small business cases are somewhat different from non-small business cases and should be investigated thoroughly.