Congress moves to raise Chapter 7 trustee pay and increase Chapter 11 quarterly fees
Also known as: Bankruptcy Administration Improvement Act of 2025
Legislative Progress
Key Points
- Chapter 7 bankruptcy trustees would get a pay raise from $60 to $120 per case for most cases, starting the first Oct. 1 after the bill becomes law.
- The bill says it does not change the chapter 7 filing fee and does not take away courts’ power to waive fees for people who can’t afford them.
- Businesses in chapter 11 would pay higher quarterly bankruptcy fees, and those increased fees would run for 10 years instead of 5.
- Some of the quarterly fees would be routed to keep the bankruptcy system funded, and $5.4 million a year (FY 2026–2031) would go to the Treasury’s general fund.
- Temporary bankruptcy judge positions would be extended from 5 years to 10 years, aiming to help courts keep up with bankruptcy caseloads.
Milestones
Held at the desk.
Received in the House.
Message on Senate action sent to the House.
Passed Senate with an amendment by Unanimous Consent. (text: CR S5475-5476)
Passed/agreed to in Senate: Passed Senate with an amendment by Unanimous Consent. (text: CR S5475-5476)
What Happens Next
Projected impacts based on AI analysis
New Chapter 7 trustee pay rules start for new cases
If you file Chapter 7 (or convert into Chapter 7) on or after this date, the trustee assigned to your case is paid $120 per case instead of $60; your Chapter 7 filing fee is not changed by this bill.
Higher Chapter 11 quarterly fee rules start for pending and new cases
If a business is already in Chapter 11 or enters Chapter 11 by this point, it may owe higher quarterly bankruptcy fees going forward, which can reduce cash available for operations and repayments.
Quarterly fees apply based on disbursements in quarters starting after the start date
Even if a Chapter 11 case began earlier, higher fees apply to money paid out in any calendar quarter that begins on or after the start date.
Required yearly deposit of $5.4 million from certain quarterly fees into the Treasury general fund begins
A set slice of the collected Chapter 11 quarterly fees is redirected each year to the government’s main checking account, which can reduce what stays in the bankruptcy trustee system funds.
Extended time window for higher quarterly fee schedule runs longer
Businesses in Chapter 11 may face the heightened quarterly fee structure for up to 10 years instead of 5, depending on how the underlying schedule is applied to their case timing.
Temporary bankruptcy judge offices remain authorized for longer terms
Bankruptcy courts can keep certain judgeships for up to 10 years instead of 5, which can help prevent slowdowns and hearing delays for people and businesses in bankruptcy.
Source Information
Document Type
Congressional Bill
Official Title
Bankruptcy Administration Improvement Act of 2025
Sponsor
Cosponsors
(10)Data Sources
Analysis generated by AI. While we strive for accuracy, this should not be considered legal or professional advice. Always verify information with official government sources.