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Title 11, BankruptcyRelease 119-102

§504 Sharing of Compensation

Title 11 › CHAPTER 5 — CREDITORS, THE DEBTOR, AND THE ESTATE › SUBCHAPTER I — CREDITORS AND CLAIMS › § 504

Last updated Aug 21, 2026|Official source

Summary

People who get payment or expense reimbursement under 503(b)(2) or 503(b)(4) must not share that payment with someone else, and they must not agree to share payments that someone else gets under those same rules. Members, partners, or regular associates in the same professional group, corporation, or partnership may split these payments among themselves. An attorney for a creditor who files a petition under 303 may share 503(b)(4) payments with other lawyers who helped. Payments may also be shared with a bona fide public-service attorney referral program that follows state law and the rules of professional conduct.

Full Legal Text

Title 11, §504

Bankruptcy, Source: USLM XML via OLRC

(a)Except as provided in subsection (b) of this section, a person receiving compensation or reimbursement under section 503(b)(2) or 503(b)(4) of this title may not share or agree to share—
(1)any such compensation or reimbursement with another person; or
(2)any compensation or reimbursement received by another person under such sections.
(b)(1)A member, partner, or regular associate in a professional association, corporation, or partnership may share compensation or reimbursement received under section 503(b)(2) or 503(b)(4) of this title with another member, partner, or regular associate in such association, corporation, or partnership, and may share in any compensation or reimbursement received under such sections by another member, partner, or regular associate in such association, corporation, or partnership.
(2)An attorney for a creditor that files a petition under section 303 of this title may share compensation and reimbursement received under section 503(b)(4) of this title with any other attorney contributing to the services rendered or expenses incurred by such creditor’s attorney.
(c)This section shall not apply with respect to sharing, or agreeing to share, compensation with a bona fide public service attorney referral program that operates in accordance with non-Federal law regulating attorney referral services and with rules of professional responsibility applicable to attorney acceptance of referrals.

Legislative History

Notes & Related Subsidiaries

Historical and Revision Notes

senate report no. 95–989

section 504 prohibits the sharing of compensation, or fee splitting, among attorneys, other professionals, or trustees. The section provides only two exceptions: partners or associates in the same professional association, partnership, or corporation may share compensation inter se; and attorneys for petitioning creditors that join in a petition commencing an involuntary case may share compensation.

Editorial Notes

Amendments

2005—Subsec. (c). Pub. L. 109–8 added subsec. (c).

Statutory Notes and Related Subsidiaries

Effective Date

of 2005 AmendmentAmendment by 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.

Reference

Citations & Metadata

Citation

11 U.S.C. § 504

Title 11, Bankruptcy

Last Updated

Aug 21, 2026

Release point: 119-102