Can an individual file Subchapter V, or is it only for companies?

An individual can be a Subchapter V debtor. The election turns on being engaged in commercial or business activities with not less than 50 percent of the debts arising from those activities, not on whether the debtor is a person or a company. Courts have read the activity requirement broadly, but the debt-source requirement keeps most ordinary wage earners out.

Is Subchapter V a separate chapter of the Bankruptcy Code?

No. It is a subchapter within Chapter 11, and it applies only in a Chapter 11 case in which a debtor who fits its statutory definition elects it (11 U.S.C. § 103). The case is filed as a Chapter 11 case, and in a voluntary case the election is made on the petition itself. Several ordinary Chapter 11 provisions still apply.

What is the Subchapter V debt limit?

Eligibility turns on a statutory ceiling on noncontingent, liquidated debts, and Congress has changed that ceiling more than once, including a temporary increase and later legislation adjusting it again. We do not publish a verified current figure for it on this page. Your local bankruptcy court and a bankruptcy attorney in your district can confirm the figure applying to a case filed today.

How long does a Subchapter V case take?

The front end moves quickly. A status conference is held no later than 60 days after the order for relief, and the debtor must file a plan no later than 90 days after it. Where a plan is confirmed over creditor objection, payments generally run for 3 years, or a longer period not exceeding 5 years fixed by the court, before discharge.

Does the codebtor protection in Chapter 13 carry over to Chapter 11?

No. The codebtor stay that restrains collection of a consumer debt from an individual liable with the debtor is a Chapter 13 provision, and it terminates if the case is closed, dismissed, or converted to Chapter 7 or Chapter 11 (11 U.S.C. § 1301). Anyone who cosigned should get advice about what changes if a case is filed under a different chapter.

Fundamentals

Individual Chapter 11 and Subchapter V

Subchapter V is a streamlined track inside Chapter 11, not a separate chapter. It applies only in a Chapter 11 case in which a debtor who meets its statutory definition elects it (11 U.S.C. § 103). Individuals may use it, but the election turns on business or commercial activity and a statutory debt ceiling, so most consumer filers use Chapter 7 or Chapter 13 instead.

Key points

Subchapter V is a streamlined version of Chapter 11 created by the Small Business Reorganization Act of 2019, which took effect in February 2020.
It applies only in a Chapter 11 case in which a debtor who fits its statutory definition elects it, and in a voluntary case that election is made on the petition.
Individuals can be Subchapter V debtors, but the track requires commercial or business activity and that at least half of the debts arise from it.
Only the debtor may file a plan, no disclosure statement is required, and a Subchapter V trustee supervises rather than liquidates.
Chapter 13 is generally simpler and cheaper for an individual whose debts fall inside its limits, so Subchapter V is a narrow route, not a default one.

If someone has told you that Chapter 11 is "for big companies," that is mostly true but not entirely. Individuals can and do file Chapter 11, and since 2020 a streamlined track called Subchapter V has existed for smaller cases. This page explains what that track is, who the law lets elect it, and how it sits alongside the two chapters most consumers actually use.

What is Subchapter V, exactly?

Subchapter V is a streamlined track inside Chapter 11, created by the Small Business Reorganization Act of 2019 and effective February 19, 2020 (Bankr. M.D. Fla. Procedure Manual — Chapter 11 - Subchapter V Cases). It is not a separate chapter of the Bankruptcy Code. A debtor commences an ordinary Chapter 11 case and elects Subchapter V treatment; the subchapter applies only in a Chapter 11 case in which a debtor who fits its statutory definition makes that election (11 U.S.C. § 103). In a voluntary case, the debtor indicates on the petition whether it is a small business debtor and, if so, whether it elects Subchapter V (U.S. Bankr. Ct. S.D. Ala., Subchapter V timeline (Judge Benjamin Kahn, 14 pp.)). The purpose was to strip out machinery that made traditional Chapter 11 unaffordable for small operations. No disclosure statement is required, a Subchapter V trustee is appointed in a supervisory and facilitative role, and the debtor remains in possession and keeps operating the business.

It is an election inside Chapter 11, not a standalone chapter.
Available to entities and to individuals who meet the statutory definition.
A Subchapter V trustee supervises and facilitates; the debtor stays in possession.

Why does it matter in a bankruptcy case?

For most people in financial distress, it does not matter at all, and that is worth saying plainly. Chapter 13 is available only to an individual with regular income whose noncontingent, liquidated debts fall inside the statutory limits, and Chapter 7 is a liquidation rather than a reorganization (U.S. Bankr. Ct. S.D. Ala., SBRA guide (Judge Paul Bonapfel, 338 pp.) (updated June 2022)). Subchapter V matters in the narrow space between those two: an individual whose debts came largely from a business, or whose debts exceed what Chapter 13 allows, may have no other reorganization route. Before 2020, that person faced a full Chapter 11 with its disclosure statement, competing plans and professional costs. Court guidance describes those requirements as burdensome or unworkable for many small businesses (Bankr. D. Md. official guidance — A Guide to the SBRA of 2019 - Rev. June 2022 (Hon. Paul W. Bonapfel, N.D.Ga.)). Subchapter V exists to make that reorganization realistic rather than theoretical.

How does an individual Subchapter V case work?

The case opens like any individual bankruptcy: petition, schedules of property, exemptions, creditors, income and expenses, and a statement of financial affairs (Bankr. D. Minn. official guidance — Chapter 11 Small Business Individual Debtor(s) Filings (Including Subchapter V)). From there the track is deliberately fast. The court holds a status conference no later than 60 days after the order for relief, and the debtor files a report on efforts toward a consensual plan no later than 14 days before it. The debtor must file a plan no later than 90 days after the order for relief, and only the debtor may file one (U.S. Bankr. Ct. S.D. Ala., Subchapter V timeline (Judge Benjamin Kahn, 14 pp.)). If creditors consent to the plan, discharge generally occurs at confirmation. If the plan is confirmed over objection, discharge generally comes after the debtor completes payments due within the first 3 years, or a longer period not exceeding 5 years fixed by the court.

Status conference: no later than 60 days after the order for relief.
Plan deadline: no later than 90 days after the order for relief, filed by the debtor alone.
Consensual confirmation generally means discharge at confirmation; confirmation over objection generally means discharge after completing plan payments.

What are the main limits and exceptions?

The election is gated. Court guidance describes the requirements as being engaged in commercial or business activities, with not less than 50 percent of the debts arising from those activities (Bankr. D. Md. official guidance — A Guide to the SBRA of 2019 - Rev. June 2022 (Hon. Paul W. Bonapfel, N.D.Ga.)). Courts have read the first requirement broadly and the second narrowly, which is why a salaried employee with ordinary consumer debts generally will not fit. There is also a statutory debt ceiling. Congress has changed that ceiling more than once, temporarily and then by later legislation, and we do not publish a verified current figure for it on this page. Two other limits catch people out: a spouse who does not independently meet the requirements cannot be added to a joint Subchapter V case, and a discharge never reaches debts the Code excepts from discharge (11 U.S.C. § 523; 11 U.S.C. § 524).

Engaged in commercial or business activities, with at least half of the debts arising from them.
A statutory debt ceiling that Congress has repeatedly adjusted.
A spouse who does not independently meet the requirements cannot file jointly in a Subchapter V case.

How is this different from Chapter 7 and Chapter 13?

Chapter 7 is a liquidation with no repayment plan; it does offer redemption of certain tangible personal property from a lien by paying the allowed secured claim in full (11 U.S.C. § 722). Chapter 13 is a repayment plan with a feature Chapter 11 has no counterpart to: a codebtor stay that restrains collection of a consumer debt from someone who signed with you, and which ends if the case is converted to Chapter 7 or Chapter 11 (11 U.S.C. § 1301). Individual Chapter 11 pulls postpetition assets and earnings into the estate (11 U.S.C. § 1115), and court guidance explains that this provision does not apply in a Subchapter V case, though a separate provision brings postpetition assets and earnings into the estate when a plan is confirmed over objection (U.S. Bankr. Ct. S.D. Ala., SBRA guide (Judge Paul Bonapfel, 338 pp.) (updated June 2022)). Cost differs sharply as well.

Structural differences between the three tracks
Feature	Chapter 7	Chapter 13	Chapter 11 (Subchapter V)
Basic shape	Liquidation, no plan payments	Repayment plan for an individual with regular income	Reorganization plan filed by the debtor
Who may use it	Individuals and most entities, with statutory exclusions (11 U.S.C. § 109)	Individuals with regular income, within debt limits	Individuals or entities meeting the Subchapter V definition, by election
Codebtor stay	No	Yes (11 U.S.C. § 1301)	No counterpart
Redemption of personal property	Yes (11 U.S.C. § 722)	Not applicable	Not applicable
Who may file a plan	No plan	The debtor	The debtor only
Disclosure statement	Not applicable	Not applicable	Not required

When might an individual file Chapter 11 instead of Chapter 13?

Two situations come up most often. The first is debt size: Chapter 13 is open only to an individual with regular income whose noncontingent, liquidated debts stay inside the statutory limits, so debts above those limits close that door. The second is the source of the debt, since the Subchapter V election requires that at least half of the debts arise from commercial or business activities. Cost pushes the other way. Court guidance states that a Chapter 13 case is in general likely to be simpler and cheaper than a Subchapter V case, and that attorney's and trustee's fees may be lower in Chapter 13 (U.S. Bankr. Ct. S.D. Ala., SBRA guide (Judge Paul Bonapfel, 338 pp.) (updated June 2022)). The court's own charges differ too: a Chapter 7 case carries a $245 statutory filing fee (28 U.S.C. § 1930(a)(1)(A), (f)(1)), a $78 administrative fee (Bankruptcy Court Miscellaneous Fee Schedule, Item 8) and a $15 trustee surcharge (Bankruptcy Court Miscellaneous Fee Schedule, Item 9), while a Chapter 13 case carries a $235 filing fee (28 U.S.C. § 1930(a)(1)(B)). Chapter 11 costs considerably more to open, and we do not publish a verified figure for it here.

What do people most commonly get wrong about individual Chapter 11?

The biggest misconception is that Chapter 11 is only for corporations. Individuals file it, and the Code contemplates that directly by treating postpetition assets and earnings of an individual Chapter 11 debtor as property of the estate (11 U.S.C. § 1115). The second misconception is that Subchapter V is a lighter, cheaper Chapter 13. Court guidance says the opposite: Chapter 13 is generally the simpler and cheaper route for an individual whose debts fit inside it. The third is timing. Courts have declined to let debtors in cases already pending elect Subchapter V after a later statute raised the debt ceiling, and have refused late elections where delay was within the debtor's control (Bankr. D. Md. official guidance — A Guide to the SBRA of 2019 - Rev. June 2022 (Hon. Paul W. Bonapfel, N.D.Ga.)). Which track fits a particular set of facts is a question for a bankruptcy attorney in your district.

Frequently asked questions

Can an individual file Subchapter V, or is it only for companies?: An individual can be a Subchapter V debtor. The election turns on being engaged in commercial or business activities with not less than 50 percent of the debts arising from those activities, not on whether the debtor is a person or a company. Courts have read the activity requirement broadly, but the debt-source requirement keeps most ordinary wage earners out.
Is Subchapter V a separate chapter of the Bankruptcy Code?: No. It is a subchapter within Chapter 11, and it applies only in a Chapter 11 case in which a debtor who fits its statutory definition elects it (11 U.S.C. § 103). The case is filed as a Chapter 11 case, and in a voluntary case the election is made on the petition itself. Several ordinary Chapter 11 provisions still apply.
What is the Subchapter V debt limit?: Eligibility turns on a statutory ceiling on noncontingent, liquidated debts, and Congress has changed that ceiling more than once, including a temporary increase and later legislation adjusting it again. We do not publish a verified current figure for it on this page. Your local bankruptcy court and a bankruptcy attorney in your district can confirm the figure applying to a case filed today.
Does a Subchapter V plan wipe out every debt?: No. A discharge voids judgments determining personal liability on discharged debts and operates as an injunction against collecting them (11 U.S.C. § 524), but it never reaches debts the Code excepts from discharge (11 U.S.C. § 523). Timing also differs: with creditor consent, discharge generally occurs at confirmation; over objection, it generally follows completion of plan payments.
How long does a Subchapter V case take?: The front end moves quickly. A status conference is held no later than 60 days after the order for relief, and the debtor must file a plan no later than 90 days after it. Where a plan is confirmed over creditor objection, payments generally run for 3 years, or a longer period not exceeding 5 years fixed by the court, before discharge.
Does the codebtor protection in Chapter 13 carry over to Chapter 11?: No. The codebtor stay that restrains collection of a consumer debt from an individual liable with the debtor is a Chapter 13 provision, and it terminates if the case is closed, dismissed, or converted to Chapter 7 or Chapter 11 (11 U.S.C. § 1301). Anyone who cosigned should get advice about what changes if a case is filed under a different chapter.

Sources

11 U.S.C. § 103 — Applicability of chapters
11 U.S.C. § 109 — Who may be a debtor · official source
11 U.S.C. § 1115 — Property of the estate
11 U.S.C. § 1301 — Stay of action against codebtor · official source
11 U.S.C. § 722 — Redemption · official source
11 U.S.C. § 523 — Exceptions to discharge · official source
11 U.S.C. § 524 — Effect of discharge · official source
Bankr. M.D. Fla. Procedure Manual — Chapter 11 - Subchapter V Cases
U.S. Bankr. Ct. S.D. Ala., Subchapter V timeline (Judge Benjamin Kahn, 14 pp.)
U.S. Bankr. Ct. S.D. Ala., SBRA guide (Judge Paul Bonapfel, 338 pp.) (updated June 2022)
Bankr. D. Md. official guidance — A Guide to the SBRA of 2019 - Rev. June 2022 (Hon. Paul W. Bonapfel, N.D.Ga.)
Bankr. D. Minn. official guidance — Chapter 11 Small Business Individual Debtor(s) Filings (Including Subchapter V)
28 U.S.C. § 1930(a)(1)(A), (f)(1)
28 U.S.C. § 1930(a)(1)(B)
Bankruptcy Court Miscellaneous Fee Schedule, Item 8
Bankruptcy Court Miscellaneous Fee Schedule, Item 9

By Antonio G. Jimenez, Esq. · Florida Bar No. 21022

Sources verified July 27, 2026 · How we verify

Every figure on this page is drawn from a primary legal source and checked against our canonical legal database before publication. Bankruptcy.law is not a law firm and does not provide legal advice.

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