A Chapter 13 (wage earner plan) petition is a request that all or a portion of the
indebtedness be repaid through a trustee for a specific period of time. When a repayment
plan has been completed, the debtor has no further repayment obligation for the listed
debts. A Chapter 13 filing is available only to debtors with a regular source of income.
A Chapter 13 bankruptcy applies to only those debts specifically included in the petition.
Even where SSA has no advance notice of the filing, we are still subject to the stay
and must refund anything collected if we receive notification that we are in violation
of the stay.
REFERENCE: For a Chapter 13 bankruptcy order which attempts to divert SSA monies to trustees,
see GN 02410.005.
REMINDER: The majority of bankruptcy claims which involve SSA debtors are Chapters 7 and 13.
Since both Chapters 7 and 13 create an automatic stay from recovery of any debt that
arose before the filing of the bankruptcy petition, SSA must stop collection. Even
where SSA has no advance notice of the filing, we are still subject to the stay and
must refund anything collected in violation of the stay.