Are large banks required to write blueprints on how to break them up in case they go bankrupt? I remember there was a talk about requiring large banks to write blueprint on how to break them up in case they go bankrupt to solve the problem of 'too big to fail' and I am wondering if this is now a legal requirement for large banks.
Yes, this was passed as part of the Dodd-Frank Act of 2010, Pub.L. 111–203. The provision for so-called "resolution plans", informally called "living wills", is in the US Code at 12 USC 5365, subsection (d). It applies to large "bank holding companies" and "nonbank financial companies". The plans are to include:
(A) information regarding the manner and extent to which any insured depository institution affiliated with the company is adequately protected from risks arising from the activities of any nonbank subsidiaries of the company;
(B) full descriptions of the ownership structure, assets, liabilities, and contractual obligations of the company;
(C) identification of the cross-guarantees tied to different securities, identification of major counterparties, and a process for determining to whom the collateral of the company is pledged; and
(D) any other information that the Board of Governors and the Corporation jointly require by rule or order.
The Federal Reserve has more information at https://www.federalreserve.gov/supervisionreg/resolution-plans.htm, including the plans submitted by the banks. For instance, Citigroup's 2021 plan.