§1194 Payments

Summary

Trustees must hold any payments and money they get until a plan is accepted or rejected. If a plan is accepted, the trustee pays out the money as the plan says. If the plan is rejected, the trustee returns the money to the debtor but first subtracts unpaid allowed administrative claims under section 503(b), any payments made to protect a secured creditor’s interest, and the trustee’s fee. If a plan is confirmed under section 1191(b), the trustee must make the plan payments to creditors unless the plan or the confirmation order says otherwise. Before a plan is confirmed, a court can, after giving notice and holding a hearing, allow the trustee to pay a secured creditor to protect that creditor’s interest.