PRIA, Government Policy, Made Personal

Summary

Require the trustee or the debtor who is still running the small business to follow several duties. They must attach recent financial statements and the Federal income tax return when they file, or in an involuntary case file those documents within 7 days after the court’s order. If no such statements or tax return exist, they must file a sworn statement saying so. They must have senior managers and lawyers attend court and United States Trustee meetings, file all schedules and financial statements on time (the court may extend the deadline but not past 30 days after the order for relief unless there are very unusual circumstances), and file any required reports during the case. They must keep insurance customary for the industry, subject to section 363(c)(2). They must file tax returns and other government filings on time and pay taxes that have administrative priority unless those taxes are being properly and actively contested, also subject to section 363(c)(2). They must let the United States Trustee or the Trustee’s representative inspect the business premises, books, and records at reasonable times after reasonable written notice, unless the debtor waives notice.

Title 11, §1116

Bankruptcy, Source: USLM XML via OLRC

In a small business case, a trustee or the debtor in possession, in addition to the duties provided in this title and as otherwise required by law, shall—

(1)append to the voluntary petition or, in an involuntary case, file not later than 7 days after the date of the order for relief—

(A)its most recent balance sheet, statement of operations, cash-flow statement, and Federal income tax return; or

(B)a statement made under penalty of perjury that no balance sheet, statement of operations, or cash-flow statement has been prepared and no Federal tax return has been filed;

(2)attend, through its senior management personnel and counsel, meetings scheduled by the court or the United States trustee, including initial debtor interviews, scheduling conferences, and meetings of creditors convened under section 341 unless the court, after notice and a hearing, waives that requirement upon a finding of extraordinary and compelling circumstances;

(3)timely file all schedules and statements of financial affairs, unless the court, after notice and a hearing, grants an extension, which shall not extend such time period to a date later than 30 days after the date of the order for relief, absent extraordinary and compelling circumstances;

(4)file all postpetition financial and other reports required by the Federal Rules of Bankruptcy Procedure or by local rule of the district court;

(5)subject to section 363(c)(2), maintain insurance customary and appropriate to the industry;

(6)(A)timely file tax returns and other required government filings; and

(B)subject to section 363(c)(2), timely pay all taxes entitled to administrative expense priority except those being contested by appropriate proceedings being diligently prosecuted; and

(7)allow the United States trustee, or a designated representative of the United States trustee, to inspect the debtor’s business premises, books, and records at reasonable times, after reasonable prior written notice, unless notice is waived by the debtor.

Notes & Related Subsidiaries

Editorial Notes

References in Text

The Federal Rules of Bankruptcy Procedure, referred to in par. (4), are set out in the Appendix to this title.

Statutory Notes and Related Subsidiaries

Effective Date

Section 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 an

Effective Date

of 2005 Amendment note under section 101 of this title.

§1116 Duties of Trustee or Debtor in Possession in Small Business Cases

Summary

Title 11, §1116

Notes & Related Subsidiaries

Editorial Notes

References in Text

Statutory Notes and Related Subsidiaries

Effective Date

Effective Date

Effective Date

Citations & Metadata