Intro to Chap 12 Bankruptcy – Restructuring the Family Farm (SAS 2005)

An Introduction to Chapter 12 Bankruptcy:
Restructuring the Family Farm
By Susan A. Schneider
Associate Professor and Director, Graduate Program in Agricultural Law
University of Arkansas School of Law

Chapter 12 bankruptcy is a special section of the Bankruptcy Code that provides for the
restructuring of the debts of a family farm or family fisherman’s business. It provides
powerful tools to debtors, sometimes enabling them to reduce their debts or restructure
their payments so that they can continue farming or fishing as their livelihood. Chapter
12 was first created in October 19861 and was recently made permanent by The
Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (the 2005
Bankruptcy Act).2 Chapter 12 has been an important tool for farmers in financial distress,