WASHINGTON, D.C. – Senator Thom Tillis and his colleagues recently introduced the bipartisan National Guard and Reservists Debt Relief Extension Act to reauthorize an additional four years of relief for qualifying members of the National Guard and Reserves experiencing financial hardship. The legislation would protect a long-standing bipartisan carveout from means-testing restrictions in Chapter 7 bankruptcy cases.
“The men and women who serve in the National Guard and Reserves provide an invaluable service to our nation,” said Senator Tillis. “I am proud to co-sponsor this bipartisan legislation that will ensure protections for members if they fall on financial hardship.”
The National Guard and Reservists Debt Relief Extension Act of 2023 would reauthorize the National Guard and Reservists Debt Relief Act of 2008, which included a clause exempting qualifying members of reserve components of the Armed Forces and the National Guard from provisions in the Bankruptcy Code, which limit access to Chapter 7 bankruptcy based on recent income.
Because National Guard members and reservists often receive higher pay while on active duty than at their civilian jobs, these limits could otherwise prevent them from receiving financial relief in bankruptcy. The National Guard and Reservist Debt Relief Extension Actensures they are not penalized for their service.