S. 3424Senate119th Congress (2025-2027)Enacted

Bankruptcy Administration Improvement Act of 2025

AI-Generated Summary

Updated December 12, 2025 at 9:01 AM UTC

The Bankruptcy Administration Improvement Act of 2025 updates the bankruptcy system’s funding and staffing rules. It raises the payment to Chapter 7 trustees from $60 to $120 per case, changes how collected fees are divided, and lengthens the term for certain temporary bankruptcy judges from five to ten years. The changes apply to federal bankruptcy courts and affect trustees, judges, and the Treasury’s fee funds.

Key Provisions

Chapter 7 trustees will receive $120 per case (an increase from the current $60) for most cases.
Portions of the fees collected in bankruptcy cases are re‑allocated: $63.51 goes to a Treasury special fund, $25 to a deficit‑reduction fund, and $51.49 to the United States Trustee System Fund.
Quarterly bankruptcy fees are adjusted – the fee period is extended to 10 years, the minimum rate is set to the greater of 0.4%, and the upper rate is increased to 0.9%.
For fiscal years 2026‑2031, $5.4 million of the quarterly fees will be deposited into the Treasury’s general fund.
The term for certain temporary bankruptcy judges is extended from five years to ten years under both the 2020 Bankruptcy Administration Improvement Act and the 2017 Bankruptcy Judgeship Act.
The amendments take effect at the start of the first calendar quarter after enactment, with specific start dates for trustee compensation and fee changes.

Legislative Activity

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13 earlier actions

Became Law Latest Action

Became Public Law No: 119-76.

February 6, 2026

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SenateIntro Referral

Introduced in Senate

December 10, 2025

SenateFloor

Introduced in the Senate, read twice, considered, read the third time, and passed without amendment by Unanimous Consent. (consideration: CR S8629-8630; text: CR S8630)

December 10, 2025

SenateFloor

Message on Senate action sent to the House.

December 11, 2025

HouseFloor

Received in the House.

December 11, 2025 • 11:23 AM

HouseFloor

Held at the desk.

December 11, 2025 • 11:29 AM

HouseFloor

Mr. Cline moved to suspend the rules and pass the bill.

January 12, 2026 • 3:47 PM

HouseFloor

Considered under suspension of the rules. (consideration: CR H626-628)

January 12, 2026 • 3:47 PM

HouseFloor

DEBATE - The House proceeded with forty minutes of debate on S. 3424.

January 12, 2026 • 3:47 PM

SenateFloor

Passed/agreed to in House: On motion to suspend the rules and pass the bill Agreed to by voice vote. (text: CR H627)

January 12, 2026 • 3:54 PM

HouseFloor

On motion to suspend the rules and pass the bill Agreed to by voice vote. (text: CR H627)

January 12, 2026 • 3:54 PM

HouseFloor

Motion to reconsider laid on the table Agreed to without objection.

January 12, 2026 • 3:54 PM

President

Presented to President.

February 3, 2026

Became Law

Signed by President.

February 6, 2026

Became Law

Became Public Law No: 119-76.

February 6, 2026

Floor Debate

3 members

What members said about S. 3424 on the floor

2 Republicans1 Democrat

Rep. Ben ClineR-VA-6 · Jan 12, 2026

Mr. Speaker, I move to suspend the rules and pass the bill (S. 3424) to amend titles 11 and 28, United States Code, to modify the compensation payable to trustees serving in cases under chapter 7 of title 11, United States Code, to extend the term of certain temporary offices of bankruptcy judges, and for other purposes.

Mr. Speaker, I ask unanimous consent that all Members may have 5 legislative days in which to revise and extend their remarks and insert extraneous material on S. 3424.

Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, I rise in support of S. 3424, the Bankruptcy Administration Improvement Act of 2025.

The bill before us today is an important piece of legislation that will help ensure the bankruptcy system continues to function efficiently and without taxpayer funding.

Congress designed the bankruptcy system to be funded through the fees imposed on those who utilize the system. From time to time, Congress has passed legislation to respond to how the bankruptcy system is operating.

S. 3424 responds to the current bankruptcy climate in three ways: First, the bill extends the temporary quarterly fees used to pay for the United States Trustee Program within the Department of Justice and bankruptcy judgeships. Ensuring taxpayers are not on the hook for the administration of the Bankruptcy Code is critical. The only way to ensure the bankruptcy system is funded far into the future is to maintain the current fee schedule.

Second, S. 3424 extends for an additional 5-year period numerous temporary bankruptcy judgeships across the country. These bankruptcy judges ensure that bankruptcy cases are quickly and efficiently administered. While bankruptcy filings in recent years have slowed, early data suggests that bankruptcy filings will likely increase in the coming years. Maintaining these temporary bankruptcy judgeships for the next 5 years will ensure that the bankruptcy system can continue to operate at full capacity if necessary.

Finally, and most importantly, S. 3424 increases the pay per case for Chapter 7 trustees. Chapter 7 trustees play a critical role in the bankruptcy system, ensuring that creditors recover as much as possible from bankruptcy debtors. Chapter 7 trustees also ensure that the government receives unpaid taxes, fines, and fees or whatever else it may be owed during a bankruptcy case. In around 90 percent of the cases, Chapter 7 trustees receive the statutory minimum payment for their services, $60 per case. This rate was established in 1994 and has never been permanently increased.

S. 3424 increases the pay per case by adjusting chapter 7 trustee compensation for inflation since 1994 to $120. This change is long overdue.

Mr. Speaker, I urge my colleagues to support this bipartisan legislation, and I reserve the balance of my time.

Mr. Speaker, I reserve the balance of my time.

Mr. Speaker, again, this important legislation promotes efficient government rather than expanding it, reinforces user-funded government services, strengthens accountability and oversight, and reduces market distortions caused by uncertainty.

Mr. Speaker, I urge its support, and I yield back the balance of my time.

Rep. Jamie RaskinD-MD-8 · Jan 12, 2026

Mr. Speaker, I yield myself such time as I may consume. Mr. Speaker, I rise in strong support of this bipartisan legislation, which will help ensure that Americans have access to bankruptcy relief…

Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, I rise in strong support of this bipartisan legislation, which will help ensure that Americans have access to bankruptcy relief when financial disaster strikes and they need it.

The legislation would increase compensation for chapter 7 trustees for the first time in more than 30 years, extend vital temporary bankruptcy judgeships, and ensure that our bankruptcy system continues to be self-funded and poses no cost to the American taxpayer.

Chapter 7 proceedings are designed for people who are most in need of financial relief. In chapter 7 bankruptcy, an individual debtor who has fallen on hard times, rather than go to debtor prison, which was the old-school method, can settle his or her debts, pay off back taxes, stop further collection actions, and secure a fresh start.

The process is means-tested, so it is available only for those who really need it, and it often comes with credit counseling and debtor education courses that can help our constituents achieve financial literacy and avoid bankruptcy a second time.

Nationwide, this process is overseen by trustees who help to distribute millions of dollars annually to local, State, and Federal Government agencies and private creditors of all types. In 1994, Congress set the pay for trustees at $60 per case, and we have not revisited that $60 pay rate in the decades since.

This bill would increase that paltry amount at long last. By doubling their fee to $120, we help to ensure that debtors will have the assistance they need to navigate the complicated and convoluted world of bankruptcy proceedings.

The bill also extends 29 temporary bankruptcy judgeships that are set to expire. In my State of Maryland alone, we are on track to lose three out of seven temporary judgeships. That is nearly half of our entire bankruptcy bench. We cannot afford to lose these judges at the very moment that bankruptcy filings are rising everywhere, up 30 percent in our State alone over the last couple of years.

Mr. Speaker, I strongly support this bill to increase the access and opportunity provided to all Americans under the bankruptcy system. I ask all of our colleagues to read it and to support it.

Mr. Speaker, I reserve the balance of my time.

Mr. Speaker, again, I restate my strong support for this bipartisan legislation, and I yield back the balance of my time.

Sen. John BarrassoR-WY · Dec 10, 2025

Mr. President, I ask unanimous consent that the Senate proceed to the immediate consideration of S. 3424, which is at the desk. The clerk will report the bill by title. I ask unanimous consent that…

Bill Text

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Enrolled BillPublication date not provided

One Hundred Nineteenth Congress of the United States of America

2d Session

Begun and held at the City of Washington on Saturday, the third day of January, two thousand and twenty six

S. 3424

AN ACT

To amend titles 11 and 28, United States Code, to modify the compensation payable to trustees serving in cases under chapter 7 of title 11, United States Code, to extend the term of certain temporary offices of bankruptcy judges, and for other purposes.

Short title

This Act may be cited as the Bankruptcy Administration Improvement Act of 2025.

Findings

Congress finds the following:

(1)

Congress has amended the laws governing bankruptcy fees as necessary to ensure that the bankruptcy system remains self-supporting, while also fairly allocating the costs of the system among those who use the system.

(2)

Because of the importance for the bankruptcy system to be self-funded, at no cost to taxpayers, Congress has closely monitored the funding needs of the bankruptcy system, including by requiring periodic reporting by the Attorney General regarding the United States Trustee System Fund.

(3)

Because the system governing bankruptcies of various types is interconnected, Congress has established fees, including filing fees, quarterly fees in chapter 11 cases, and other fees, that together fund the courts, judges, United States trustees, and trustees serving in bankruptcy cases under chapter 7 of title 11, United States Code.

(4)

Trustees serving in bankruptcy cases under chapter 7 of title 11, United States Code, are vital to the functioning of the bankruptcy system, as they provide services at the front lines of the bankruptcy process, administering thousands of cases.

(5)

Chapter 7 bankruptcy trustees provide valuable returns of assets to government creditors, including the Internal Revenue Service, the Department of Agriculture, the Small Business Administration, and other Federal, State, and municipal governments.

(6)

Due to the work of the chapter 7 bankruptcy trustees, millions of dollars are also disbursed annually to private creditors of all types, including medical providers, unsecured creditors, small businesses, and micro-enterprises such as domestic support providers.

(7)

Despite the essential role of chapter 7 bankruptcy trustees, since 1994 the amount of compensation paid to these trustees has not been increased. As in 1994, bankruptcy trustees receive only $60 per case (composed of $45 from subsection 330(b)(1), and $15 from subsection 330(b)(2), of title 11, United States Code) in nearly 90 percent of chapter 7 cases, and bankruptcy trustees receive no compensation at all for cases in which the filing fee is waived by the bankruptcy court.

(8)

Since 1994, there have been significant increases in salaries, attorney fees, budget appropriations, filing fees, and court-related fees associated with chapter 7 bankruptcies. In contrast, the $60 paid to chapter 7 trustees has remained the same and has not even been increased for inflation. In 2021, Congress attempted to implement a mechanism that would give chapter 7 trustees a raise, but the trustees only received increased compensation for 1 fiscal year. Based on Consumer Price Index estimates, the $60 paid to trustees in 1994 would be the equivalent of over $125 today.

(9)

This Act and the amendments made by this Act—

(A)

increase the compensation of chapter 7 bankruptcy trustees to the level that is appropriate, overdue, and proportionate with the level that was intended in 1994, by increasing the total compensation of trustees to $120 per case;

(B)

ensure adequate funding of the United States trustee system through the increase of certain fees, which will also apply to districts that are not part of a United States trustee region as required by existing law; and

(C)

support the preservation of existing bankruptcy judgeships that are urgently needed to handle existing and anticipated increases in business and consumer caseloads.

(10)

This Act will not alter the filing fee under chapter 7 of title 11, United States Code, and will not modify, impair, or supersede the current authority of the district courts of the United States, or of bankruptcy courts, to waive the payment of filing fees by indigent individuals.

Trustee compensation

(a)

Compensation of officers

Section 330 of title 11, United States Code, is amended—

(1)

in subsection (b)(1) by striking $45 and inserting $105; and

(2)

by striking subsection (e).

(b)

Remainder of fees

Notwithstanding any other provision of law, the remainder of fees collected under section 1930(a)(1)(A) of title 28, United States Code, after compensating trustees under section 330(b)(1) of title 11, United States Code, shall be deposited as follows:

(1)

$63.51 in the special fund of the Treasury established under section 1931 of title 28, United States Code.

(2)

$25.00 in the special fund established in accordance with section 10101(b) of the Deficit Reduction Act of 2005 (28 U.S.C. 1931 note).

(3)

$51.49 in the United States Trustee System Fund established under section 589a of title 28, United States Code.

(c)

United States Trustee System Fund

Section 589a of title 28, United States Code, is amended—

(1)

in subsection (b)(1)(A), by striking 40.46 percent of the fees collected and inserting $51.49 of the fees collected in each case; and

(2)

in subsection (f)(1)—

(A)

in subparagraph (D) by striking Fourth and inserting Second;

(B)

by striking subparagraphs (B) and (C); and

(C)

by redesignating subparagraph (D) as subparagraph (B).

Bankruptcy fees

(a)

Quarterly fees

Section 1930(a)(6)(B) of title 28, United States Code, is amended—

(1)

in clause (i), by striking 5-year and inserting 10-year; and

(2)

in clause (ii)—

(A)

in subclause (I)—

(i)

by inserting the greater of before 0.4; and

(ii)

by striking and at the end and inserting or; and

(B)

in subclause (II), by striking 0.8 and inserting 0.9.

(b)

Period for deposits

Section 589a(f) of title 28, United States Code, as amended by section 3(c)(2), is amended by striking 2026 each place it appears and inserting 2031.

(c)

Deposits of certain fees for fiscal years 2026 through 2031

Notwithstanding section 589a(b) of title 28, United States Code, for each of fiscal years 2026 through 2031—

(1)

the fees collected under section 1930(a)(6) of title 28, United States Code, less the amount specified in subparagraph (2) of this subsection, shall be deposited as specified in section 589a(f) of title 28, United States Code, as amended by this Act; and

(2)

$5,400,000 of the fees collected under section 1930(a)(6) of title 28, United States Code, shall be deposited in the general fund of the Treasury.

Extension of term of certain temporary offices of bankruptcy judge

(a)

Bankruptcy Administration Improvement Act of 2020

Section 4 of the Bankruptcy Administration Improvement Act of 2020 (28 U.S.C. 152 note) is amended—

(1)

in subsection (a)(2)—

(A)

in subparagraph (A)(i), by striking 5 years and inserting 10 years; and

(B)

in subparagraph (B)(i), by striking 5 years and inserting 10 years;

(2)

in subsection (b)(2)—

(A)

in subparagraph (A)(i), by striking 5 years and inserting 10 years;

(B)

in subparagraph (B)(i), by striking 5 years and inserting 10 years;

(C)

in subparagraph (C)(i), by striking 5 years and inserting 10 years;

(D)

in subparagraph (D)(i), by striking 5 years and inserting 10 years;

(E)

in subparagraph (E)(i), by striking 5 years and inserting 10 years; and

(F)

in subparagraph (F)(i), by striking 5 years and inserting 10 years;

(3)

in subsection (c)(2)—

(A)

in subparagraph (A)(i), by striking 5 years and inserting 10 years; and

(B)

in subparagraph (B)(i), by striking 5 years and inserting 10 years;

(4)

in subsection (d)(2)—

(A)

in subparagraph (A)(i), by striking 5 years and inserting 10 years; and

(B)

in subparagraph (B)(i), by striking 5 years and inserting 10 years;

(5)

in subsection (e)(2)(A), by striking 5 years and inserting 10 years; and

(6)

in subsection (f)(2)(A), by striking 5 years and inserting 10 years.

(b)

Bankruptcy Judgeship Act of 2017

Section 1003(b)(2)(A) of the Bankruptcy Judgeship Act of 2017 (28 U.S.C. 152 note) is amended by striking ‘‘5 years’’ and inserting ‘‘10 years’’.

Effective date; application of amendments

(a)

In general

Except as provided in subsection (b), the amendments made by this Act shall take effect on the first day of the calendar quarter that first occurs on or after the date of enactment of this Act.

(b)

Exceptions

(1)

Compensation of officers

Section 3 and the amendments made by section 3 shall apply to any case under title 11, United States Code, commenced on or after October 1 that first occurs after the date of enactment of this Act—

(A)

under chapter 7 of title 11, United States Code; or

(B)

under chapter 11, 12, or 13 of title 11, United States Code, that is converted to a case under chapter 7 of title 11, United States Code.

(2)

Bankruptcy fees

Section 4 and the amendments made by section 4 shall apply to—

(A)

any case commenced or pending under chapter 11 of title 11, United States Code, on the first day of the calendar quarter that first occurs on or after the date of enactment of this Act; and

(B)

quarterly fees payable under section 1930(a)(6) of title 28, United States Code, as amended by section 4, for disbursements made in any calendar quarter that begins on or after the date of enactment of this Act.

Speaker of the House of Representatives

Vice President of the United States and President of the Senate