Congress·Passed Senate·S. 3424

Congress raises Chapter 7 trustee pay and increases Chapter 11 quarterly fees to help fund bankruptcy courts

Bankruptcy Administration Improvement Act of 2025

3 months ago·View on Congress.gov

Part of: Bankruptcy Administration Improvement Act of 2025

⏸

Stalled

No legislative action in over 90 days.

Legislative Progress

✓ Senate

House

President

Law

Key Points

Raises the base pay for Chapter 7 bankruptcy trustees from $45 to $105 per case, aiming to better cover the work trustees do in most simple bankruptcies.
Keeps Chapter 7 filing fees the same and does not change courts’ power to waive filing fees for people who can’t afford them.
Increases certain ongoing fees paid in Chapter 11 business bankruptcies (the quarterly fees), helping keep the bankruptcy system funded without taxpayer money.
Extends several temporary bankruptcy judge positions from 5 years to 10 years so courts can better handle heavy and rising bankruptcy caseloads.
Sets when the changes start, with trustee-pay changes beginning after the next October 1 that follows the law’s enactment date.

Consumer ProtectionSmall BusinessEconomyCriminal Justice

Impact Analysis

Personal Impact

How this policy affects specific groups of people

Mixed Impacts(4)

Union Member

Neutral

Gig Worker

Neutral

Retiree

Neutral

Housing Assistance

Neutral

Positive Impacts(1)

Small Business Owner

Helps

Milestones

3 milestones5 actions

Dec 11, 2025House

Held at the desk.

Dec 11, 2025House

Received in the House.

Dec 10, 2025Senate

Introduced in the Senate, read twice, considered, read the third time, and passed without amendment by Unanimous Consent.

Dec 10, 2025

Passed/agreed to in Senate: Introduced in the Senate, read twice, considered, read the third time, and passed without amendment by Unanimous Consent.

Dec 10, 2025

Introduced in Senate

What Happens Next

Projected impacts based on AI analysis

First day of the calendar quarter on or after enactment

Chapter 11 quarterly fee changes start applying to pending and new Chapter 11 cases

Businesses already in Chapter 11 and those that file after enactment may see higher quarterly fees and should budget for them right away.

For any calendar quarter that begins on or after enactment

New quarterly-fee percentage applies to disbursements in quarters beginning after enactment

A Chapter 11 debtor’s fee bill can increase starting with the first quarter that begins after enactment, based on what the business pays out that quarter.

Applies to cases commenced on or after October 1 that first occurs after enactment

Higher Chapter 7 trustee per-case compensation begins for newly started Chapter 7 cases

If you file Chapter 7 after the trigger date, the trustee assigned to your case is paid under the new amounts, which may help keep trustee staffing stable. Your Chapter 7 filing fee is not changed by this bill.

Conversions to Chapter 7 in cases commenced on/after the first Oct 1 after enactment

Higher trustee compensation applies to cases converted into Chapter 7

If a Chapter 11, 12, or 13 case later converts to Chapter 7 after the trigger date, the trustee compensation rules follow the new amounts.

Fiscal years 2026 through 2031

Adjusted fee deposits continue through FY2031, including $5.4M/year to the general Treasury

The bankruptcy system’s fee money gets routed under the new rules for several years, helping fund trustees and the system while also sending a set amount to the Treasury each year.

First day of the calendar quarter on or after enactment

Temporary bankruptcy judge office extensions take effect

Bankruptcy courts can keep certain judge positions in place longer, which can help avoid delays from understaffing.