Source: http://uscode.house.gov/view.xhtml?path=/prelim@title11/chapter13&edition=prelim
Timestamp: 2019-04-24 14:18:33+00:00

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Stay of action against codebtor.
Rights and powers of debtor.
Filing and allowance of postpetition claims.
Filing of prepetition tax returns.
Modification of plan before confirmation.
Modification of plan after confirmation.
Revocation of an order of confirmation.
2005—Pub. L. 109–8, title VII, §716(b)(2), Apr. 20, 2005, 119 Stat. 130, added item 1308.
(3) such creditor's interest would be irreparably harmed by continuation of such stay.
Section 1301 of the House amendment is identical with the provision contained in section 1301 of the House bill and adopted by the Senate amendment. Section 1301(c)(1) indicates that a basis for lifting the stay is that the debtor did not receive consideration for the claim by the creditor, or in other words, the debtor is really the "codebtor." As with other sections in title 11, the standard of receiving consideration is a general rule, but where two co-debtors have agreed to share liabilities in a different manner than profits it is the individual who does not ultimately bear the liability that is protected by the stay under section 1301.
Subsection (a) automatically stays the holder of a claim based on a consumer debt of the chapter 13 debtor from acting or proceeding in any way, except as authorized pursuant to subsections (b) and (c), against an individual or the property of an individual liable with the chapter 13 debtor, unless such codebtor became liable in the ordinary course of his business, or unless the case is closed, dismissed, or converted to another chapter.
Under the terms of the agreement with the codebtor who is not in bankruptcy, the creditor has a right to collect all payments to the extent they are not made by the debtor at the time they are due. To the extent to which a chapter 13 plan does not propose to pay a creditor his claims, the creditor may obtain relief from the court from the automatic stay and collect such claims from the codebtor. Conversely, a codebtor obtains the benefit of any payments made to the creditor under the plan. If a debtor defaults on scheduled payments under the plan, then the codebtor would be liable for the remaining deficiency; otherwise, payments not made under the plan may never be made by the codebtor. The obligation of the codebtor to make the creditor whole at the time payments are due remains.
The automatic stay under this section pertains only to the collection of a consumer debt, defined by section 101(7) of this title to mean a debt incurred by an individual primarily for a personal, family, or household purpose. Therefore, not all debts owed by a chapter 13 debtor will be subject to the stay of the codebtor, particularly those business debts incurred by an individual with regular income, as defined by section 101(24) of this title, engaged in business, that is permitted by virtue of section 109(b) and section 1304 to obtain chapter 13 relief.
Subsection (b) excepts the giving of notice of dishonor of a negotiable instrument from the reach of the codebtor stay.
Under subsection (c), if the codebtor has property out of which the creditor's claim can be satisfied, the court can grant relief from the stay absent the transfer of a security interest in that property by the codebtor to the creditor. Correspondingly, if there is reasonable cause to believe that property is about to be disposed of by the codebtor which could be used to satisfy his obligation to the creditor, the court should lift the stay to allow the creditor to perfect his rights against such property. Likewise, if property is subject to rapid depreciation or decrease in value the stay should be lifted to allow the creditor to protect his rights to reach such property. Otherwise, the creditor's interest would be irreparably harmed by such stay. Property which could be used to satisfy the claim could be disposed of or encumbered and placed beyond the reach of the creditor. The creditor should be allowed to protect his rights to reach property which could satisfy his claim and prevent its erosion in value, disposal, or encumbrance.
This section is new. It is designed to protect a debtor operating under a chapter 13 individual repayment plan case by insulating him from indirect pressures from his creditors exerted through friends or relatives that may have cosigned an obligation of the debtor. The protection is limited, however, to ensure that the creditor involved does not lose the benefit of the bargain he made for a cosigner. He is entitled to full compensation, including any interest, fees, and costs provided for by the agreement under which the debtor obtained his loan. The creditor is simply required to share with other creditors to the extent that the debtor will repay him under the chapter 13 plan. The creditor is delayed, but his substantive rights are not affected.
Subsection (a) is the operative subsection. It stays action by a creditor after an order for relief under chapter 13. The creditor may not act, or commence or continue any civil action, to collect all or any part of a consumer debt of the debtor from any individual that is liable on such debt with the debtor, or that has secured the debt, unless the individual became liable or secured the debt in the ordinary course of his business, or the case is closed, dismissed, or converted to chapter 7 or 11.
Subsection (b) permits the creditor, notwithstanding the stay, to present a negotiable instrument and to give notice of dishonor of the instrument, in order to preserve his substantive rights against the codebtor as required by applicable nonbankruptcy law.
Subsection (c) requires the court to grant relief from the stay in certain circumstances. The court must grant relief to the extent that the debtor does not propose to pay, under the plan, the amount owed to the creditor. The court must also grant relief to the extent that the debtor was really the codebtor in the transaction, that is, to the extent that the nondebtor party actually received the consideration for the claim held by the creditor. Finally, the court must grant relief to the extent that the creditor's interest would be irreparably harmed by the stay, for example, where the codebtor filed bankruptcy himself, or threatened to leave the locale, or lost his job.
1984—Subsec. (c)(3). Pub. L. 98–353, §524, inserted "continuation of" after "by".
Subsec. (d). Pub. L. 98–353, §313, added subsec. (d).
(2)(A) The holder of a claim described in subsection (b)(6) or the State child support enforcement agency of the State in which such holder resides may request from a creditor described in paragraph (1)(C)(iv) the last known address of the debtor.
Section 1302 of the House amendment adopts a provision contained in the Senate amendment instead of the position taken in the House bill. Sections 1302(d) and (e) are modeled on the standing trustee system contained in the House bill with the court assuming supervisory functions in districts not under the pilot program.
The principal administrator in a chapter 13 case is the chapter 13 trustee. Experience under chapter XIII of the Bankruptcy Act [chapter 13 of former title 11] has shown that the more efficient and effective wage earner programs have been conducted by standing chapter XIII trustees who exercise a broad range of responsibilities in both the design and the effectuation of debtor plans.
Subsection (a) provides administrative flexibility by permitting the bankruptcy judge to appoint an individual from the panel of trustees established pursuant to 28 U.S.C. §604(f) and qualified under section 322 of title 11, either to serve as a standing trustee in all chapter 13 cases filed in the district or a portion thereof, or to serve in a single case.
Subsection (b)(1) makes it clear that the chapter 13 trustee is no mere disbursing agent of the monies paid to him by the debtor under the plan [section 1322(a)(1)], by imposing upon him certain relevant duties of a liquidation trustee prescribed by section 704 of this title.
Subsection (b)(2) requires the chapter 13 trustee to appear before and be heard by the bankruptcy court whenever the value of property secured by a lien or the confirmation or modification of a plan after confirmation as provided by sections 1323–1325 is considered by the court.
Subsection (b)(3) requires the chapter 13 trustee to advise and counsel the debtor while under chapter 13, except on matters more appropriately left to the attorney for the debtor. The chapter 13 trustee must also assist the debtor in performance under the plan by attempting to tailor the requirements of the plan to the changing needs and circumstances of the debtor during the extension period.
Subsection (c) imposes on the trustee in a chapter 13 case filed by a debtor engaged in business the investigative and reporting duties normally required of a chapter 11 debtor or trustee as prescribed by section 1106(a)(3) and (4).
Subsection (d) gives the trustee an additional duty if the debtor is engaged in business, as defined in section 1304. The trustee must perform the duties specified in sections 1106(a)(3) and 1106(a)(4), relating to investigation of the debtor.
Chapter XIII of the Bankruptcy Act, referred to in subsec. (b)(3), is chapter XIII of act July 1, 1898, ch. 541, as added June 22, 1938, ch. 575, §1, 52 Stat. 930, which was classified to chapter 13 (§1001 et seq.) of former Title 11.
Sections 464 and 466 of the Social Security Act, referred to in subsec. (d)(1)(A)(i), are classified to sections 664 and 666, respectively, of Title 42, The Public Health and Welfare.
2010—Subsec. (b)(1). Pub. L. 111–327 substituted "704(a)(2), 704(a)(3), 704(a)(4), 704(a)(5), 704(a)(6), 704(a)(7), and 704(a)(9)" for "704(2), 704(3), 704(4), 704(5), 704(6), 704(7), and 704(9)".
2005—Subsec. (b)(6). Pub. L. 109–8, §219(d)(1), added par. (6).
Subsec. (d). Pub. L. 109–8, §219(d)(2), added subsec. (d).
1994—Subsec. (b)(3). Pub. L. 103–394 struck out "and" at end.
1986—Subsec. (a). Pub. L. 99–554, §228(1), amended subsec. (a) generally. Prior to amendment, subsec. (a) read as follows: "If the court has appointed an individual under subsection (d) of this section to serve as standing trustee in cases under this chapter and if such individual qualifies under section 322 of this title, then such individual shall serve as trustee in the case. Otherwise, the court shall appoint a person to serve as trustee in the case."
Subsec. (d). Pub. L. 99–554, §228(2), struck out subsec. (d) which read as follows: "If the number of cases under this chapter commenced in a particular judicial district so warrant, the court may appoint one or more individuals to serve as standing trustee for such district in cases under this chapter."
Subsec. (e). Pub. L. 99–554, §283(w), which directed the amendment of par. (1) by substituting "set for such individual" for "fix" could not be executed in view of the repeal of subsec. (e) by section 228(2) of Pub. L. 99–554. See 1984 Amendment note below.
1984—Subsec. (b)(1). Pub. L. 98–353, §314(1), substituted "704(7), and 704(9) of this title" for "and 704(8) of this title".
Subsec. (b)(2). Pub. L. 98–353, §314(2), struck out "and" at the end.
Subsec. (b)(3) to (5). Pub. L. 98–353, §525(a), added par. (3) and redesignated former pars. (3) and (4) as (4) and (5), respectively.
Pub. L. 98–353, §314(3), (4), substituted "; and" for the period at end of par. (3) and added par. (4).
Subsec. (e)(1). Pub. L. 98–353, §525(b)(1), which directed the amendment of par. (4) by substituting "set for such individual" for "fix" was executed to par. (1) as the probable intent of Congress.
Subsec. (e)(1)(A). Pub. L. 98–353, §525(b)(2), struck out "for such individual" after "a maximum annual compensation".
Subsec. (e)(2)(A). Pub. L. 98–353, §525(b)(3), substituted "received by" for "of", and "of all such payments made" for "upon all payments".
Effective date and applicability of amendment by section 228 of Pub. L. 99–554 dependent upon the judicial district involved, see section 302(d), (e) of Pub. L. 99–554, set out as a note under section 581 of Title 28, Judiciary and Judicial Procedure.
Subject to any limitations on a trustee under this chapter, the debtor shall have, exclusive of the trustee, the rights and powers of a trustee under sections 363(b), 363(d), 363(e), 363(f), and 363(l), of this title.
Section 1303 of the House amendment specifies rights and powers that the debtor has exclusive of the trustees. The section does not imply that the debtor does not also possess other powers concurrently with the trustee. For example, although section 1323 is not specified in section 1303, certainly it is intended that the debtor has the power to sue and be sued.
A chapter 13 debtor is vested with the identical rights and powers, and is subject to the same limitations in regard to their exercise, as those given a liquidation trustee by virtue of section 363(b), (d), (e), (f), and (h) of title 11, relating to the sale, use or lease of property.
(a) A debtor that is self-employed and incurs trade credit in the production of income from such employment is engaged in business.
(b) Unless the court orders otherwise, a debtor engaged in business may operate the business of the debtor and, subject to any limitations on a trustee under sections 363(c) and 364 of this title and to such limitations or conditions as the court prescribes, shall have, exclusive of the trustee, the rights and powers of the trustee under such sections.
(c) A debtor engaged in business shall perform the duties of the trustee specified in section 704(a)(8) of this title.
Section 1304(b) of the House amendment adopts the approach taken in the comparable section of the Senate amendment as preferable to the position taken in the House bill.
Increased access to the simpler, speedier, and less expensive debtor relief provisions of chapter 13 is accomplished by permitting debtors engaged in business to proceed under chapter 13, provided their income is sufficiently stable and regular to permit compliance with a chapter 13 plan [section 101(24)] and that the debtor (or the debtor and spouse) do not owe liquidated, noncontingent unsecured debts of $50,000, or liquidated, noncontingent secured debts of $200,000 (§109(d)).
Section 1304(a) states that a self-employed individual who incurs trade credit in the production of income is a debtor engaged in business.
Subsection (b) empowers a chapter 13 debtor engaged in business to operate his business, subject to the rights, powers and limitations that pertain to a trustee under sections 363(c) and 364 of title 11, and subject to such further limitations and conditions as the court may prescribe.
Subsection (c) requires a chapter 13 debtor engaged in business to file with the court certain financial statements relating to the operation of the business.
2010—Subsec. (c). Pub. L. 111–327 substituted "704(a)(8)" for "704(8)".
1984—Subsec. (b). Pub. L. 98–353, §526, struck out the comma after "of the debtor".
Subsec. (c). Pub. L. 98–353, §311(b)(2), substituted "section 704(8)" for "section 704(7)".
(2) that is a consumer debt, that arises after the date of the order for relief under this chapter, and that is for property or services necessary for the debtor's performance under the plan.
(c) A claim filed under subsection (a)(2) of this section shall be disallowed if the holder of such claim knew or should have known that prior approval by the trustee of the debtor's incurring the obligation was practicable and was not obtained.
Section 1305(a)(2) of the House amendment modifies similar provisions contained in the House and Senate bills by restricting application of the paragraph to a consumer debt. Debts of the debtor that are not consumer debts should not be subjected to section 1305(c) or section 1328(d) of the House amendment.
Section 1305(b) of the House amendment represents a technical modification of similar provisions contained in the House bill and Senate amendment.
The House amendment deletes section 1305(d) of the Senate amendment as unnecessary. Section 502(b)(1) is sufficient to disallow any claim to the extent the claim represents the usurious interest or any other charge forbidden by applicable law. It is anticipated that the Rules of Bankruptcy Procedure may require a creditor filing a proof of claim in a case under chapter 13 to include an affirmative statement as contemplated by section 1305(d) of the Senate amendment.
Section 1305, exclusively applicable in chapter 13 cases, supplements the provisions of sections 501–511 of title 11, dealing with the filing and allowance of claims. Sections 501–511 apply in chapter 13 cases by virtue of section 103(a) of this title. Section 1305(a) provides for the filing of a proof of claim for taxes and other obligations incurred after the filing of the chapter 13 case. Subsection (b) prescribes that section 502 of title 11 governs the allowance of section 1305(a) claims, except that its standards shall be applied as of the date of allowance of the claim, rather than the date of filing of the petition. Subsection (c) requires the disallowance of a postpetition claim for property or services necessary for the debtor's performance under the plan, if the holder of the claim knew or should have known that prior approval by the trustee of the debtor's incurring of the obligation was practicable and was not obtained.
Subsection (a) permits the filing of a proof of a claim against the debtor that is for taxes that become payable to a governmental unit while the case is pending, or that arises after the date of the filing of the petition for property or services that are necessary for the debtor's performance under the plan, such as auto repairs in order that the debtor will be able to get to work, or medical bills. The effect of the latter provision, in paragraph (2), is to treat postpetition credit extended to a chapter 13 debtor the same as a prepetition claim for purposes of allowance, distribution, and so on.
Section 1306(a)(2) adopts a provision contained in the Senate amendment in preference to a similar provision contained in the House bill.
Section 541 is expressly made applicable to chapter 13 cases by section 103(a). Section 1306 broadens the definition of property of the estate for chapter 13 purposes to include all property acquired and all earnings from services performed by the debtor after the commencement of the case.
Subsection (b) nullifies the effect of section 521(3), otherwise applicable, by providing that a chapter 13 debtor need not surrender possession of property of the estate, unless required by the plan or order of confirmation.
1986—Subsec. (a). Pub. L. 99–554 inserted reference to chapter 12 in pars. (1) and (2).
(b) On request of the debtor at any time, if the case has not been converted under section 706, 1112, or 1208 of this title, the court shall dismiss a case under this chapter. Any waiver of the right to dismiss under this subsection is unenforceable.
(11) failure of the debtor to pay any domestic support obligation that first becomes payable after the date of the filing of the petition.
(d) Except as provided in subsection (f) of this section, at any time before the confirmation of a plan under section 1325 of this title, on request of a party in interest or the United States trustee and after notice and a hearing, the court may convert a case under this chapter to a case under chapter 11 or 12 of this title.
(f) The court may not convert a case under this chapter to a case under chapter 7, 11, or 12 of this title if the debtor is a farmer, unless the debtor requests such conversion.
(g) Notwithstanding any other provision of this section, a case may not be converted to a case under another chapter of this title unless the debtor may be a debtor under such chapter.
Section 1307(a) is derived from the Senate amendment in preference to a comparable provision contained in the House bill.
Subsections (a) and (b) confirm, without qualification, the rights of a chapter 13 debtor to convert the case to a liquidating bankruptcy case under chapter 7 of title 11, at any time, or to have the chapter 13 case dismissed. Waiver of any such right is unenforceable. Subsection (c) specifies various conditions for the exercise of the power of the court to convert a chapter 13 case to one under chapter 7 or to dismiss the case. Subsection (d) deals with the conversion of a chapter 13 case to one under chapter 11. Subsection (e) prohibits conversion of the chapter 13 case filed by a farmer to chapter 7 or 11 except at the request of the debtor. No case is to be converted from chapter 13 to any other chapter, unless the debtor is an eligible debtor under the new chapter.
Subsection (f) reinforces section 109 by prohibiting conversion to a chapter under which the debtor is not eligible to proceed.
2010—Subsec. (c). Pub. L. 111–327, §2(a)(41)(A)(i), substituted "subsection (f)" for "subsection (e)" in introductory provisions.
Subsec. (c)(9), (10). Pub. L. 111–327, §2(a)(41)(A)(ii), (iii), substituted "521(a)" for "521".
Subsec. (d). Pub. L. 111–327, §2(a)(41)(B), substituted "subsection (f)" for "subsection (e)".
2005—Subsec. (c)(11). Pub. L. 109–8, §213(7), added par. (11).
Subsecs. (e) to (g). Pub. L. 109–8, §716(c), added subsec. (e) and redesignated former subsecs. (e) and (f) as (f) and (g), respectively.
1986—Subsec. (b). Pub. L. 99–554, §257(v)(1), inserted reference to section 1208 of this title.
Subsec. (c). Pub. L. 99–554, §229(1)(A), inserted "or the United States trustee" after "party in interest" in provisions preceding par. (1).
Subsec. (c)(9), (10). Pub. L. 99–554, §229(1)(B)–(D), added pars. (9) and (10).
Subsec. (d). Pub. L. 99–554, §257(v)(2), inserted reference to chapter 12.
Pub. L. 99–554, §229(2), inserted "or the United States trustee" after "party in interest".
Subsec. (e). Pub. L. 99–554, §257(v)(3), inserted reference to chapter 12.
1984—Subsec. (b). Pub. L. 98–353, §527(a), inserted a comma after "time".
Subsec. (c)(4). Pub. L. 98–353, §315(2), added par. (4). Former par. (4) redesignated (5).
Subsec. (c)(5). Pub. L. 98–353, §§315(1), 527(b)(1), redesignated former par. (4) as (5) and inserted "a request made for" before "additional". Former par. (5) redesignated (6).
Subsec. (c)(6). Pub. L. 98–353, §315(1), redesignated former par. (5) as (6). Former par. (6) redesignated (7).
Subsec. (c)(7). Pub. L. 98–353, §§315(1), 527(b)(2), redesignated former par. (6) as (7) and substituted "or" for "and". Former par. (7) redesignated (8).
Subsec. (c)(8). Pub. L. 98–353, §§315(1), 527(b)(3), redesignated former par. (7) as (8) and inserted "other than completion of payments under the plan" after "in the plan".
Effective date and applicability of amendment by section 229 of Pub. L. 99–554 dependent upon the judicial district involved, see section 302(d), (e) of Pub. L. 99–554, set out as a note under section 581 of Title 28, Judiciary and Judicial Procedure.
(c) For purposes of this section, the term "return" includes a return prepared pursuant to subsection (a) or (b) of section 6020 of the Internal Revenue Code of 1986, or a similar State or local law, or a written stipulation to a judgment or a final order entered by a nonbankruptcy tribunal.
Section 6020 of the Internal Revenue Code of 1986, referred to in subsec. (c), is classified to section 6020 of Title 26, Internal Revenue Code.
2010—Subsec. (b)(2). Pub. L. 111–327, §2(a)(42)(C), substituted "paragraph (1)" for "this subsection" wherever appearing in introductory provisions.
Subsec. (b)(2)(A). Pub. L. 111–327, §2(a)(42)(A), substituted "paragraph (1)(A)" for "paragraph (1)".
Subsec. (b)(2)(B). Pub. L. 111–327, §2(a)(42)(B), substituted "paragraph (1)(B)" for "paragraph (2)".
The debtor shall file a plan.
Chapter 13 contemplates the filing of a plan only by the debtor.
(4) notwithstanding any other provision of this section, may provide for less than full payment of all amounts owed for a claim entitled to priority under section 507(a)(1)(B) only if the plan provides that all of the debtor's projected disposable income for a 5-year period beginning on the date that the first payment is due under the plan will be applied to make payments under the plan.
(2) in a case in which the last payment on the original payment schedule for a claim secured only by a security interest in real property that is the debtor's principal residence is due before the date on which the final payment under the plan is due, the plan may provide for the payment of the claim as modified pursuant to section 1325(a)(5) of this title.
(f) A plan may not materially alter the terms of a loan described in section 362(b)(19) and any amounts required to repay such loan shall not constitute "disposable income" under section 1325.
Section 1322(b)(2) of the House amendment represents a compromise agreement between similar provisions in the House bill and Senate amendment. Under the House amendment, the plan may modify the rights of holders of secured claims other than a claim secured by a security interest in real property that is the debtor's principal residence. It is intended that a claim secured by the debtor's principal residence may be treated with under section 1322(b)(5) of the House amendment.
Section 1322(c) adopts a 5-year period derived from the House bill in preference to a 4-year period contained in the Senate amendment. A conforming change is made in section 1329(c) adopting the provision in the House bill in preference to a comparable provision in the Senate amendment.
Tax payments in wage earner plans: The House bill provided that a wage earner plan had to provide that all priority claims would be paid in full. The Senate amendment contained a special rule in section 1325(c) requiring that Federal tax claims must be paid in cash, but that such tax claims can be paid in deferred cash installments under the general rules applicable to the payment of debts in a wage earner plan, unless the Internal Revenue Service negotiates with the debtor for some different medium or time for payment of the tax liability.
The House bill adopts the substance of the Senate amendment rule under section 1322(a)(2) of the House amendment. A wage earner plan must provide for full payment in deferred cash payments, of all priority claims, unless the holder of a particular claim agrees with a different treatment of such claim.
Chapter 13 is designed to serve as a flexible vehicle for the repayment of part or all of the allowed claims of the debtor. Section 1322 emphasizes that purpose by fixing a minimum of mandatory plan provisions.
Subsection (a) requires that the plan submit whatever portion of the future income of the debtor is necessary to implement the plan to the control of the trustee, mandates payment in full of all section 507 priority claims, and requires identical treatment for all claims of a particular class.
Subsection (b) permits a chapter 13 plan to (1) divide unsecured claims not entitled to priority under section 507 into classes in the manner authorized for chapter 11 claims; (2) modify the rights of holders of secured and unsecured claims, except claims wholly secured by real estate mortgages; (3) cure or waive any default; (4) propose payments on unsecured claims concurrently with payments on any secured claim or any other class of unsecured claims; (5) provide for curing any default on any secured or unsecured claim on which the final payment is due after the proposed final payment under the plan; (6) provide for payment of any allowed postpetition claim; (7) assume or reject any previously unrejected executory contract or unexpired lease of the debtor; (8) propose the payment of all or any part of any claim from property of the estate or of the debtor; (9) provide for the vesting of property of the estate; and (10) include any other provision not inconsistent with other provisions of title 11.
Subsection (c) limits the payment period under the plan to 3 years, except that a 4–year payment period may be permitted by the court.
2010—Subsec. (a). Pub. L. 111–327, §2(a)(43)(A), struck out "shall" after "plan" in introductory provisions.
Subsec. (a)(1) to (3). Pub. L. 111–327, §2(a)(43)(B)–(D), inserted "shall" before "provide".
Subsec. (a)(4). Pub. L. 111–327, §2(a)(43)(E), struck out "a plan" before "may provide".
2005—Subsec. (a)(4). Pub. L. 109–8, §213(8), added par. (4).
Subsec. (b)(10), (11). Pub. L. 109–8, §213(9), added par. (10) and redesignated former par. (10) as (11).
Subsec. (d). Pub. L. 109–8, §318(1), amended subsec. (d) generally. Prior to amendment, subsec. (d) read as follows: "The plan may not provide for payments over a period that is longer than three years, unless the court, for cause, approves a longer period, but the court may not approve a period that is longer than five years."
Subsec. (f). Pub. L. 109–8, §224(d), added subsec. (f).
1994—Subsecs. (c), (d). Pub. L. 103–394, §301, added subsec. (c) and redesignated former subsec. (c) as (d).
Subsec. (e). Pub. L. 103–394, §305(c), added subsec. (e).
1984—Subsec. (a)(2). Pub. L. 98–353, §528(a), inserted a comma after "payments".
Subsec. (b)(1). Pub. L. 98–353, §316, inserted "; however, such plan may treat claims for a consumer debt of the debtor if an individual is liable on such consumer debt with the debtor differently than other unsecured claims".
Subsec. (b)(2). Pub. L. 98–353, §528(b)(1), inserted ", or leave unaffected the rights of the holders of any class of claims".
Subsec. (b)(4). Pub. L. 98–353, §528(b)(2), inserted "other" after "claim or any".
Subsec. (b)(7). Pub. L. 98–353, §528(b)(3), inserted "subject to section 365 of this title," before "provide", substituted ", rejection, or assignment" for "or rejection", and substituted "under such section" for "under section 365 of this title".
Subsec. (b)(8). Pub. L. 98–353, §528(b)(4), struck out "any" before "part of a claim".
Amendment by section 301 of Pub. L. 103–394 effective Oct. 22, 1994, and not applicable with respect to cases commenced under this title before Oct. 22, 1994, and amendment by section 305(c) of Pub. L. 103–394 effective Oct. 22, 1994, and applicable only to agreements entered into after Oct. 22, 1994, see section 702 of Pub. L. 103–394, set out as a note under section 101 of this title.
By notice dated Feb. 16, 2016, 81 F.R. 8748, effective Apr. 1, 2016, in subsec. (d), dollar amount "675" was adjusted to "700" each time it appeared. See notice of the Judicial Conference of the United States set out as a note under section 104 of this title.
By notice dated Feb. 12, 2013, 78 F.R. 12089, effective Apr. 1, 2013, in subsec. (d), dollar amount "625" was adjusted to "675" each time it appeared.
By notice dated Feb. 19, 2010, 75 F.R. 8747, effective Apr. 1, 2010, in subsec. (d)(1)(C), (2)(C), dollar amount "575" was adjusted to "625".
By notice dated Feb. 7, 2007, 72 F.R. 7082, effective Apr. 1, 2007, in subsec. (d), dollar amount "525" was adjusted to "575" each time it appeared.
2005—Pub. L. 109–8 designated existing provisions as subsec. (a), substituted "Except as provided in subsection (b) and after" for "After", and added subsec. (b).
1986—Pub. L. 99–554 struck out "the" after "object to".
1984—Pub. L. 98–353 struck out "the" before "confirmation of the plan".
(B) the plan provides that all of the debtor's projected disposable income to be received in the applicable commitment period beginning on the date that the first payment is due under the plan will be applied to make payments to unsecured creditors under the plan.
Section 1325(a)(5)(B) of the House amendment modifies the House bill and Senate amendment to significantly protect secured creditors in chapter 13. Unless the secured creditor accepts the plan, the plan must provide that the secured creditor retain the lien securing the creditor's allowed secured claim in addition to receiving value, as of the effective date of the plan of property to be distributed under the plan on account of the claim not less than the allowed amount of the claim. To this extent, a secured creditor in a case under chapter 13 is treated identically with a recourse creditor under section 1111(b)(1) of the House amendment except that the secured creditor in a case under chapter 13 may receive any property of a value as of the effective date of the plan equal to the allowed amount of the creditor's secured claim rather than being restricted to receiving deferred cash payments. Of course, the secured creditors&apos; lien only secures the value of the collateral and to the extent property is distributed of a present value equal to the allowed amount of the creditor's secured claim the creditor's lien will have been satisfied in full. Thus the lien created under section 1325(a)(5)(B)(i) is effective only to secure deferred payments to the extent of the amount of the allowed secured claim. To the extent the deferred payments exceed the value of the allowed amount of the secured claim and the debtor subsequently defaults, the lien will not secure unaccrued interest represented in such deferred payments.
The bankruptcy court must confirm a plan if (1) the plan satisfies the provisions of chapter 13 and other applicable provisions of title 11; (2) it is proposed in good faith; (3) it is in the best interests of creditors, and defined by subsection (a)(4) of Section 1325; (4) it has been accepted by the holder of each allowed secured claim provided for the plan or where the holder of any such secured claim is to receive value under the plan not less than the amount of the allowed secured claim, or where the debtor surrenders to the holder the collateral securing any such allowed secured claim; (5) the plan is feasible; and (6) the requisite fees and charges have been paid.
Subsection (b) authorizes the court to order an entity, as defined by Section 101(15), to pay any income of the debtor to the trustee. Any governmental unit is an entity subject to such an order.
2010—Subsec. (a). Pub. L. 111–327, §2(a)(44)(A), inserted "period" after "910-day" in concluding provisions.
Subsec. (b)(2)(A)(ii). Pub. L. 111–327, §2(a)(44)(B), inserted closing parenthesis after "548(d)(3)".
2006—Subsec. (b)(3). Pub. L. 109–439 inserted ", other than subparagraph (A)(ii) of paragraph (2)," after "under paragraph (2)" in introductory provisions.
2005—Subsec. (a). Pub. L. 109–8, §306(b), inserted concluding provisions at end "For purposes of paragraph (5), section 506 shall not apply to a claim described in that paragraph if the creditor has a purchase money security interest securing the debt that is the subject of the claim, the debt was incurred within the 910-day preceding the date of the filing of the petition, and the collateral for that debt consists of a motor vehicle (as defined in section 30102 of title 49) acquired for the personal use of the debtor, or if collateral for that debt consists of any other thing of value, if the debt was incurred during the 1-year period preceding that filing."
Subsec. (a)(5)(B)(i). Pub. L. 109–8, §306(a), amended cl. (i) generally. Prior to amendment, cl. (i) read as follows: "the plan provides that the holder of such claim retain the lien securing such claim; and".
Subsec. (a)(5)(B)(iii). Pub. L. 109–8, §309(c)(1), added cl. (iii).
Subsec. (a)(7). Pub. L. 109–8, §102(g), added par. (7).
Subsec. (a)(8). Pub. L. 109–8, §213(10), added par. (8).
Subsec. (a)(9). Pub. L. 109–8, §716(a), added par. (9).
Subsec. (b)(1)(B). Pub. L. 109–8, §318(2), substituted "applicable commitment period" for "three-year period".
Pub. L. 109–8, §102(h)(1), inserted "to unsecured creditors" after "to make payments".
"(B) if the debtor is engaged in business, for the payment of expenditures necessary for the continuation, preservation, and operation of such business."
Subsec. (b)(4). Pub. L. 109–8, §318(3), added par. (4).
1998—Subsec. (b)(2)(A). Pub. L. 105–183 inserted before semicolon ", including charitable contributions (that meet the definition of &apos;charitable contribution&apos; under section 548(d)(3)) to a qualified religious or charitable entity or organization (as that term is defined in section 548(d)(4)) in an amount not to exceed 15 percent of the gross income of the debtor for the year in which the contributions are made".
1986—Subsec. (b)(2)(A). Pub. L. 99–554 substituted "; and" for "; or".
1984—Subsec. (a). Pub. L. 98–353, §317(1), substituted "Except as provided in subsection (b), the" for "The".
Subsec. (a)(1). Pub. L. 98–353, §530, inserted "the" before "other".
Subsecs. (b), (c). Pub. L. 98–353, §317(2), (3), added subsec. (b) and redesignated former subsec. (b) as (c).
By notice dated Feb. 16, 2016, 81 F.R. 8748, effective Apr. 1, 2016, in subsec. (b), dollar amount "675" was adjusted to "700" each time it appeared. See notice of the Judicial Conference of the United States set out as a note under section 104 of this title.
By notice dated Feb. 12, 2013, 78 F.R. 12089, effective Apr. 1, 2013, in subsec. (b), dollar amount "625" was adjusted to "675" each time it appeared.
By notice dated Feb. 19, 2010, 75 F.R. 8747, effective Apr. 1, 2010, in subsec. (b)(3), (4), dollar amount "575" was adjusted to "625".
By notice dated Feb. 7, 2007, 72 F.R. 7082, effective Apr. 1, 2007, in subsec. (b), dollar amount "525" was adjusted to "575" each time it appeared.
(C) that provides adequate protection directly to a creditor holding an allowed claim secured by personal property to the extent the claim is attributable to the purchase of such property by the debtor for that portion of the obligation that becomes due after the order for relief, reducing the payments under subparagraph (A) by the amount so paid and providing the trustee with evidence of such payment, including the amount and date of payment.
(2) A payment made under paragraph (1)(A) shall be retained by the trustee until confirmation or denial of confirmation. If a plan is confirmed, the trustee shall distribute any such payment in accordance with the plan as soon as is practicable. If a plan is not confirmed, the trustee shall return any such payments not previously paid and not yet due and owing to creditors pursuant to paragraph (3) to the debtor, after deducting any unpaid claim allowed under section 503(b).
(3) Subject to section 363, the court may, upon notice and a hearing, modify, increase, or reduce the payments required under this subsection pending confirmation of a plan.
(4) Not later than 60 days after the date of filing of a case under this chapter, a debtor retaining possession of personal property subject to a lease or securing a claim attributable in whole or in part to the purchase price of such property shall provide the lessor or secured creditor reasonable evidence of the maintenance of any required insurance coverage with respect to the use or ownership of such property and continue to do so for so long as the debtor retains possession of such property.
(ii) the amount payable to unsecured nonpriority creditors, as provided by the plan, multiplied by 5 percent, and the result divided by the number of months in the plan.
(2) such compensation is payable in a case under this chapter only to the extent permitted by subsection (b)(3).
Section 1326(a)(2) of the House amendment adopts a comparable provision contained in the House bill providing for standing trustees.
Section 1326 supplements the priorities provisions of section 507. Subsection (a) requires accrued costs of administration and filing fees, as well as fees due the chapter 13 trustee, to be disbursed before payments to creditors under the plan. Subsection (b) makes it clear that the chapter 13 trustee is normally to make distribution to creditors of the payments made under the plan by the debtor.
Subsection (a) requires that before or at the time of each payment any outstanding administrative expenses [and] any percentage fee due for a private standing chapter 13 trustee be paid in full.
"(a)(1) Unless the court orders otherwise, the debtor shall commence making the payments proposed by a plan within 30 days after the plan is filed.
"(2) A payment made under this subsection 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 as soon as practicable. If a plan is not confirmed, the trustee shall return any such payment to the debtor, after deducting any unpaid claim allowed under section 503(b) of this title."
Subsec. (b)(1). Pub. L. 109–8, §1502(a)(10), substituted "507(a)(2)" for "507(a)(1)".
Subsec. (b)(3). Pub. L. 109–8, §1224(1), added par. (3).
Subsec. (d). Pub. L. 109–8, §1224(2), added subsec. (d).
1994—Subsec. (a)(2). Pub. L. 103–394 inserted "as soon as practicable" before period at end of second sentence.
1986—Subsec. (a)(2). Pub. L. 99–554, §283(z), substituted "payment" for "payments" in last sentence.
Subsec. (b). Pub. L. 99–554, §230, amended subsec. (b) generally, substituting "586(b) of title 28" for "1302(d) of this title" and "586(e)(1)(B) of title 28" for "1302(e) of this title" in par. (2).
1984—Subsec. (a). Pub. L. 98–353, §318(a)(2), added subsec. (a). Former subsec. (a) redesignated (b).
Subsec. (b). Pub. L. 98–353, §318(a)(1), redesignated subsec. (a) as (b). Former subsec. (b) redesignated (c).
Subsec. (b)(2). Pub. L. 98–353, §531, inserted "of this title" after "1302(d)".
Subsec. (c). Pub. L. 98–353, §318(a)(1), redesignated former subsec. (b) as (c).
Effective date and applicability of amendment by section 230 of Pub. L. 99–554 dependent upon the judicial district involved, see section 302(d), (e) of Pub. L. 99–554, set out as a note under section 581 of Title 28, Judiciary and Judicial Procedure.
By notice dated Feb. 16, 2016, 81 F.R. 8748, effective Apr. 1, 2016, in subsec. (b)(3), dollar amount "25" was adjusted to "25". See notice of the Judicial Conference of the United States set out as a note under section 104 of this title.
By notice dated Feb. 12, 2013, 78 F.R. 12089, effective Apr. 1, 2013, in subsec. (b)(3), dollar amount "25" was adjusted to "25".
By notice dated Feb. 19, 2010, 75 F.R. 8747, effective Apr. 1, 2010, in subsec. (b)(3)(B), dollar amount "25" was adjusted to "25".
By notice dated Feb. 7, 2007, 72 F.R. 7082, effective Apr. 1, 2007, in subsec. (b)(3), dollar amount "25" was adjusted to "25".
Subsection (a) binds the debtor and each creditor to the provisions of a confirmed plan, whether or not the claim of the creditor is provided for by the plan and whether or not the creditor has accepted, rejected, or objected to the plan. Unless the plan itself or the order confirming the plan otherwise provides, confirmation is deemed to vest all property of the estate in the debtor, free and clear of any claim or interest of any creditor provided for by the plan.
(d) Notwithstanding any other provision of this section, a discharge granted under this section does not discharge the debtor from any debt based on an allowed claim filed under section 1305(a)(2) of this title if prior approval by the trustee of the debtor's incurring such debt was practicable and was not obtained.
(g)(1) The court shall not grant a discharge under this section to a debtor unless after filing a petition the debtor has completed an instructional course concerning personal financial management described in section 111.
(2) Paragraph (1) shall not apply with respect to a debtor who is a person described in section 109(h)(4) or who resides in a district for which the United States trustee (or the bankruptcy administrator, if any) determines that the approved instructional courses are not adequate to service the additional individuals who would otherwise be required to complete such instructional course by reason of the requirements of paragraph (1).
Section 1328(a) adopts a provision contained in the Senate amendment permitting the court to approve a waiver of discharge by the debtor. It is anticipated that such a waiver must be in writing executed after the order for relief in a case under chapter 13.
The court is to enter a discharge, unless waived, as soon as practicable after completion of payments under the plan. The debtor is to be discharged of all debts provided for by the plan or disallowed under section 502, except a debt provided for under the plan the last payment on which was not due until after the completion of the plan, or a debt incurred for willful and malicious conversion of or injury to the property or person of another.
Subsection (b) is the successor to Bankruptcy Act Section 661 [section 1061 of former title 11]. This subsection permits the bankruptcy judge to grant the debtor a discharge at any time after confirmation of a plan, if the court determines, after notice and hearing, that the failure to complete payments under the plan is due to circumstances for which the debtor should not justly be held accountable, the distributions made to each creditor under the plan equal in value the amount that would have been paid to the creditor had the estate been liquidated under chapter 7 of title 11 at the date of the hearing under this subsection, and that modification of the plan is impracticable. The discharge granted under subsection (b) relieves the debtor from all unsecured debts provided for by the plan or disallowed under section 502, except nondischargeable debts described in section 523(a) of title 11 or debts of the type covered by section 1322(b)(5).
Subsection (d) excepts from any chapter 13 discharge a debt based on an allowed section 1305(a)(2) postpetition claim, if prior trustee approval of the incurring of the debt was practicable but was not obtained.
A chapter 13 discharge obtained through fraud and before the moving party gained knowledge of the fraud may be revoked by the court under subsection (e), after notice and hearing, at the request of any party in interest made within 1 year after the discharge was granted.
2005—Subsec. (a). Pub. L. 109–8, §330(d)(1), substituted "Subject to subsection (d), as" for "As" in introductory provisions.
"(3) for restitution, or a criminal fine, included in a sentence on the debtor's conviction of a crime."
Pub. L. 109–8, §213(11), inserted ", and in the case of a debtor who is required by a judicial or administrative order, or by statute, to pay a domestic support obligation, after such debtor certifies that all amounts payable under such order or such statute that are due on or before the date of the certification (including amounts due before the petition was filed, but only to the extent provided for by the plan) have been paid" after "completion by the debtor of all payments under the plan" in introductory provisions.
Subsec. (a)(2). Pub. L. 109–8, §707, substituted "section 507(a)(8)(C) or in paragraph (1)(B), (1)(C)," for "paragraph".
Subsec. (b). Pub. L. 109–8, §330(d)(2), substituted "Subject to subsection (d), at" for "At" in introductory provisions.
Subsec. (f). Pub. L. 109–8, §312(2), added subsec. (f).
Subsec. (g). Pub. L. 109–8, §106(c), added subsec. (g).
Subsec. (h). Pub. L. 109–8, §330(d)(3), added subsec. (h).
1994—Subsec. (a)(2). Pub. L. 103–394, §501(d)(38)(A), substituted "(5), (8), or (9)" for "(5) or (8)".
Subsec. (a)(3). Pub. L. 103–394, §501(d)(38)(B), struck out last par. (3). See 1990 Amendment note below.
Pub. L. 103–394, §302, inserted ", or a criminal fine," after "restitution".
1990—Subsec. (a)(1). Pub. L. 101–581, §3(1), and Pub. L. 101–647, §3103(1), made identical amendments striking "or" at end.
Subsec. (a)(2). Pub. L. 101–581, §3(2), and Pub. L. 101–647, §3103(2), made identical amendments substituting "; or" for period at end.
Pub. L. 101–581, §2(b), and Pub. L. 101–647, §3102(b), which directed identical insertions of "or 523(a)(9)" after "523(a)(5)", could not be executed because of prior amendment by Pub. L. 101–508. See below.
Pub. L. 101–508 substituted "paragraph (5) or (8) of section 523(a)" for "section 523(a)(5)".
Subsec. (a)(3). Pub. L. 101–581, §3(3), and Pub. L. 101–647, §3103(3), made identical amendments adding par. (3).
1984—Subsec. (e)(1). Pub. L. 98–353, §532(1), inserted "by the debtor" after "obtained".
Subsec. (e)(2). Pub. L. 98–353, §532(2), substituted "the requesting party did not know of such fraud until" for "knowledge of such fraud came to the requesting party".
Amendments by Pub. L. 109–8 effective 180 days after Apr. 20, 2005, with amendments by sections 106(c), 213(11), 312(2), 314(b), and 707 of Pub. L. 109–8 not applicable with respect to cases commenced under this title before such effective date, except as otherwise provided, and amendment by section 330(d) of Pub. L. 109–8 applicable with respect to cases commenced under this title on or after Apr. 20, 2005, see section 1501 of Pub. L. 109–8, set out as a note under section 101 of this title.
Amendment by Pub. L. 101–647 effective Nov. 29, 1990, but not applicable with respect to cases commenced under this title before Nov. 29, 1990, see section 3104 of Pub. L. 101–647, set out as a note under section 523 of this title.
Amendment by Pub. L. 101–581 effective Nov. 15, 1990, but not applicable with respect to cases commenced under this title before Nov. 15, 1990, see section 4 of Pub. L. 101–581, set out as a note under section 523 of this title.
Pub. L. 101–508, title III, §3007(b)(2), Nov. 5, 1990, 104 Stat. 1388–29, provided that: "The amendment made by paragraph (1) [amending this section] shall not apply to any case under the provisions of title 11, United States Code, commenced before the date of the enactment of this Act [Nov. 5, 1990]."
(b)(1) Sections 1322(a), 1322(b), and 1323(c) of this title and the requirements of section 1325(a) of this title apply to any modification under subsection (a) of this section.
At any time prior to the completion of payments under a confirmed plan, the plan may be modified, after notice and hearing, to change the amount of payments to creditors or a particular class of creditors and to extend or reduce the payment period. A modified plan may not contain any provision which could not be included in an original plan as prescribed by section 1322. A modified plan may not call for payments to be made beyond four years as measured from the date of the commencement of payments under the original plan.
2005—Subsec. (a)(4). Pub. L. 109–8, §102(i), added par. (4).
Subsec. (c). Pub. L. 109–8, §318(4), substituted "the applicable commitment period under section 1325(b)(1)(B)" for "three years".
1984—Subsec. (a). Pub. L. 98–353, §§319, 533(1), (2), inserted "of the plan" after "confirmation", substituted "such plan" for "a plan", and inserted provisions respecting requests by the debtor, the trustee, or the holder of an allowed unsecured claim for modification.
Subsec. (a)(3). Pub. L. 98–353, §533(3), substituted "plan to" for "plan, to".
(a) On request of a party in interest at any time within 180 days after the date of the entry of an order of confirmation under section 1325 of this title, and after notice and a hearing, the court may revoke such order if such order was procured by fraud.
(b) If the court revokes an order of confirmation under subsection (a) of this section, the court shall dispose of the case under section 1307 of this title, unless, within the time fixed by the court, the debtor proposes and the court confirms a modification of the plan under section 1329 of this title.
Section 1331 of the House bill and Senate amendment is deleted in the House amendment.
Special tax provision: Section 1331 of title 11 of the House bill and the comparable provisions in sections 1322 and 1327(d) of the Senate amendment, pertaining to assessment and collection of taxes in wage earner plans, are deleted, and the governing rule is placed in section 505(c) of the House amendment. The provisions of both bills allowing assessment and collection of taxes after confirmation of the wage-earner plan are modified to allow assessment and collection after the court fixes the fact and amount of a tax liability, including administrative period taxes, regardless of whether this occurs before or after confirmation of the plan. The provision of the House bill limiting the collection of taxes to those assessed before one year after the filing of the petition is eliminated, thereby leaving the period of limitations on assessment of these nondischargeable tax liabilities the usual period provided by the Internal Revenue Code [Title 26].
The court may revoke an order of confirmation procured by fraud, after notice and hearing, on application of a party in interest filed within 180 days after the entry of the order. Thereafter, unless a modified plan is confirmed, the court is to convert or dismiss the chapter 13 case as provided in section 1307.

References: §716
 §524
 §313
 §604
 §1
 §219
 §219
 §228
 §228
 §283
 §314
 §314
 §525
 §314
 §525
 §525
 §525
 §526
 §311
 §2
 §2
 §2
 §213
 §716
 §257
 §229
 §229
 §257
 §229
 §257
 §527
 §315
 §315
 §2
 §2
 §2
 §2
 §2
 §2
 §213
 §213
 §318
 §224
 §301
 §305
 §528
 §316
 §528
 §528
 §528
 §528
 §2
 §2
 §306
 §306
 §309
 §102
 §213
 §716
 §318
 §102
 §318
 §317
 §530
 §317
 §1502
 §1224
 §1224
 §283
 §230
 §318
 §318
 §531
 §318
 §330
 §213
 §707
 §330
 §312
 §106
 §330
 §501
 §501
 §302
 §3
 §3103
 §3
 §3103
 §2
 §3102
 §3
 §3103
 §532
 §532
 §3007
 §102
 §318
 §533