Bankruptcy System Overhaul: Trustee Pay Increase and Extended Judge Terms.
This law aims to strengthen the self-funded bankruptcy system by addressing outdated compensation for trustees who handle personal bankruptcy cases (Chapter 7). It doubles the base pay for these trustees, ensuring they can effectively administer cases and return assets to creditors, including small businesses and medical providers. The necessary funding is secured by increasing quarterly fees paid by large corporate bankruptcies (Chapter 11).
Key points
Compensation for trustees handling personal bankruptcies (Chapter 7) is doubled from $60 to $120 per case, reflecting inflation since 1994 and ensuring the system remains functional.
Filing fees for individual Chapter 7 bankruptcies are not increased, and the ability for low-income individuals to waive fees remains protected.
Terms for temporary bankruptcy judges are extended from 5 to 10 years to maintain court capacity and efficiently manage increasing consumer and business caseloads.
Status:
Passed Senate
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