Bankruptcy debt limits go up for people and small businesses.

What it does

This bill raises debt limits for bankruptcy. People can now file with up to $2.75 million in debt. Small businesses can now file with up to $7.5 million in debt. Higher limits let more people and businesses use bankruptcy courts. They can reorganize or erase their debts.

Who it affects

People with large debts and small business owners are affected. More individuals and small businesses now qualify for bankruptcy. Banks and creditors who lend money may also be affected.

One thing to notice

More people and businesses can now use bankruptcy courts. This could change how banks and creditors lend money.

From the analysis of the bill text, linked under Primary records below.

Where it stands

6 cosponsors: 3 Democrats, 3 Republicans.

• Feb 26, 2026 — Introduced · Congress.gov: “Introduced in House”
• Feb 26, 2026 — Referred to House Committee on the Judiciary · Congress.gov: “Referred to the House Committee on the Judiciary”
• Mar 26, 2026 — Markup held in committee · Congress.gov: “Committee Consideration and Mark-up Session Held”
• Mar 26, 2026 — Reported out of committee · Congress.gov: “Ordered to be Reported (Amended) by Voice Vote”
• Sep 16, 2026 — Passed the House · Congress.gov: “On motion to suspend the rules and pass the bill, as amended Agreed to by voice vote”
• Sep 16, 2026 — Floor vote scheduled · Congress.gov: “Mr. Cline moved to suspend the rules and pass the bill, as amended”

Dates and quoted wording are Congress.gov's action record; the timeline shows status changes, not every procedural step.

Money around this bill

2 groups reported lobbying about this bill. They filed 2 reports from Jun 2026 to Jun 2026.

Those reports show $480,000 in lobbying spending. Each report lists about 10 bills. So that money was not all for this bill.

More groups named this bill than 41% of bills with any report.

Ben Cline, who sponsored the bill, received $633,776 from PACs for the 2026 election.

• International Council of Shopping Centers — $460,000 in 1 report
• National Association of Bankruptcy Trustees — $20,000 in 1 report

Lobbying is legal. These reports show who lobbied about this bill, not what changed.

Words to know

• bankruptcy — A court process where people or businesses with too much debt get help reorganizing or erasing debts.
• reorganize — To arrange debts into a new payment plan instead of erasing them all at once.
• erase — To cancel debts so a person or business no longer owes the money.
• lobbying — Trying to influence lawmakers about a bill. Companies and groups pay people to do this.
• PACs — Groups that collect money and give it to candidates for office.
• sponsored — To sponsor a bill is to introduce it in Congress and put your name on it.