§1226 — Title 11 Bankruptcy | U.S. Code

Summary

The trustee must hold any money they get from the debtor until the court approves or rejects the repayment plan. If the plan is approved, the trustee pays out the money as the plan says. If the plan is rejected, the trustee gives the money back to the debtor after taking out any unpaid claims allowed under 11 U.S.C. §503(b) and the standing trustee’s percentage fee if one is handling the case. When the trustee makes payments to creditors under the plan, they must first pay any unpaid priority claims under 11 U.S.C. §507(a)(2) and the standing trustee’s percentage fee set under 11 U.S.C. §1202(d). Unless the plan or the court’s approval order says otherwise, the trustee is the one who makes those payments.

Title 11, §1226

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(a)Payments and funds received by the trustee shall be retained by the trustee until confirmation or denial of confirmation of a plan. If a plan is confirmed, the trustee shall distribute any such payment in accordance with the plan. If a plan is not confirmed, the trustee shall return any such payments to the debtor, after deducting—

(1)any unpaid claim allowed under section 503(b) of this title; and

(2)if a standing trustee is serving in the case, the percentage fee fixed for such standing trustee.

(b)Before or at the time of each payment to creditors under the plan, there shall be paid—

(1)any unpaid claim of the kind specified in section 507(a)(2) of this title; and

(2)if a standing trustee appointed under section 1202(c) 11 See References in Text note below. of this title is serving in the case, the percentage fee fixed for such standing trustee under section 1202(d) 1 of this title.

(c)Except as otherwise provided in the plan or in the order confirming the plan, the trustee shall make payments to creditors under the plan.

Notes & Related Subsidiaries

Editorial Notes

References in Text

section 1202(c) and (d) of this title, referred to in subsec. (b)(2), was repealed by section 227 of Pub. L. 99–554, and provisions relating to appointment of and fixing percentage fees for standing trustees are contained in section 586(b) and (e) of Title 28, Judiciary and Judicial Procedure, as amended by section 113(b), (c) of Pub. L. 99–554. Codification For repeal of section effective Oct. 1, 1998, and subsequent reenactment of section, see note set out preceding section 1201 of this title.

Amendments

2005—Subsec. (b)(1). Pub. L. 109–8, § 1502(a)(9), substituted “507(a)(2)” for “507(a)(1)”. 1994—Subsec. (b)(2). Pub. L. 103–394 substituted “1202(c)” for “1202(d)” and “1202(d)” for “1202(e)”.

Statutory Notes and Related Subsidiaries

Effective Date

of 2005 AmendmentAmendment by section 1502(a)(9) of Pub. L. 109–8 effective 180 days after Apr. 20, 2005, and not applicable with respect to cases commenced under this title before such

Effective Date

, except as otherwise provided, see section 1501 of Pub. L. 109–8, set out as a note under section 101 of this title.

Effective Date

of 1994 AmendmentAmendment by Pub. L. 103–394 effective Oct. 22, 1994, and not applicable with respect to cases commenced under this title before Oct. 22, 1994, see section 702 of Pub. L. 103–394, set out as a note under section 101 of this title.

Effective Date

sPermanent reenactment of section effective July 1, 2005, see section 1001(a)(2) of Pub. L. 109–8, set out as a Repeal, Reenactment, and Termination of Chapter note under section 1201 of this title. For

Effective Date

s of section and

Amendments

extending periods for which section was reenacted prior to permanent reenactment, see

Effective Date

and

Effective Date

of 1999, 2001, 2002, 2003, and 2004 Amendment notes set out under section 1201 of this title.

§1226 Payments

Summary

Title 11, §1226

Notes & Related Subsidiaries

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References in Text

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Statutory Notes and Related Subsidiaries

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