Automatic Adjustment of Certain Dollar Amounts in the Bankruptcy Code and Official Bankruptcy Forms
On April 1, 2013, automatic adjustments to the dollar amounts stated in various provisions of the Bankruptcy Code and one provision in Title 28 of the United States Code will become effective. The amended dollar amounts will apply to cases filed on or after April 1, 2013.
In the Bankruptcy Reform Act of 1994, as amended by the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005, and Pub. L. No. 110-406 (2008), Congress provided for the automatic adjustment of these dollar amounts at three-year intervals. The relevant provisions are codified in 11 U.S.C. § 104(a). The amended dollar amounts will affect, among other matters:
- the eligibility of a debtor to file under chapters 12 and 13 of the Bankruptcy Code
- certain maximum values of property that a debtor may claim as exempt
- the maximum amount of certain claims entitled to priority
- the calculation of the “means test” for chapter 7 debtors
- the duration of a chapter 13 plan
- the definition of a small business debtor
- the minimum aggregate value of claims needed to commence an involuntary bankruptcy
- the value of “luxury goods and services” deemed to be nondischargeable
- where the trustee may commence certain proceedings to recover a money judgment or property
The adjustments reflect the change in the Consumer Price Index for All Urban Consumers published by the United States Department of Labor for the three-year period ending December 31, 2012, and rounded to the nearest $25. Use of this formula to adjust specified dollar amounts in the Bankruptcy Code is prescribed by 11 U.S.C. § 104(a).
Several Official Bankruptcy Forms and Director’s Forms contain references to these dollar amounts and they will be amended as appropriate on April 1, 2013.