Sponsors (11)
The bill strengthens and stabilizes pay and funding for trustees, judges, and the bankruptcy oversight system—improving court continuity and predictability—but does so by reallocating and earmarking more filers' fees (and diverting a small annual amount to the Treasury), which raises costs for bankruptcy users, reduces funding flexibility/transparency, and creates some legal and transition risks.
Chapter 7 trustees and bankruptcy officers nationwide will receive higher and clearer compensation ( trustee pay increased and compensation funding prioritized), improving trustee support and retention.
The U.S. Trustee System and bankruptcy administration get a more predictable, dedicated funding stream (specific revenue splits and retained deposits), supporting oversight and steady court operations.
Bankruptcy courts can retain temporary judgeships for 10 years instead of 5, giving districts longer staffing continuity and reducing the frequency of reauthorization/appointment tasks.
Individuals and businesses that use the bankruptcy system will likely face higher filing-related fees and periodic (quarterly) fee adjustments, increasing the cost of filing or participating in bankruptcy.
Specific earmarking of filing-fee dollars and the $5.4M annual diversion to the Treasury reduce flexibility of fee receipts and risk lowering funding available for some bankruptcy-related services, potentially requiring taxpayer backfills or cuts to services.
Shifting more of the system's costs onto fee payers (rather than general appropriations) could disproportionately burden low- and middle-income filers despite fee-waiver protections for some.
Based on analysis of 6 sections of legislative text.
Increases chapter 7 trustee pay, reallocates bankruptcy filing and quarterly fees to fund trustee and special accounts, extends temporary bankruptcy judgeships from 5 to 10 years, and temporarily redirects some fees to Treasury FY2026–FY2031.
Official title: 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.
Introduced May 7, 2025 by Christopher A. Coons · Last progress August 8, 2025
Increases pay for chapter 7 trustees, reallocates how bankruptcy filing and quarterly fees are split among the United States Trustee System Fund, special funds, and (temporarily for FY2026–FY2031) the general Treasury, and extends certain temporary bankruptcy judgeship term lengths from 5 to 10 years. Most changes take effect on the first October 1 after enactment and apply to new chapter 7 filings and to pending chapter 11 cases as specified. The bill updates statutory fee deposit percentages and dollar allocations to raise funding for the U.S. Trustee System, makes structural edits to fee-distribution language in title 28, and lengthens temporary-authority periods for some bankruptcy judgeships. One amendment to trustee compensation text appears malformed and could create ambiguity without corrective technical edits.