"prt sc 11 0 11- - 1/ * = 11. delete home pg up CHAPTER 7 The Chapter 12 Bankruptcy 479 19. The plan may provide for the payment of interest accruing after the filing of the petition on nondischargeable debts (such as student loans) but only if the debtor the full payment of all allowed claims. has disposable income available to pay such interest after making provision for confirmation of the plan The determination by the like Chapter 13, which does not provide the debtor with a method for dealing bankruptcy court that the with long-term secured debts, Chapter 12 does offer the family farmer a method for proposed plan in Chapters 11, Wealing with long-term secured debts owed on both farmland and equipment. Such 12, or 13 case meets the secured debts can be paid out after the other payments under the three-year plan have Seen completed. 11 U.S.C.A. $ 1222(b)(9). The Bankruptcy Code does not specify the confirmation requirements bigth of this extended period. Chapter 12 was written specifically to allow the farmer of the Bankruptcy Code. to handle this type of long-term mortgage debt that is so much a part of farm life. best-interests-of- The value of nonexempt property, as of the effective date of the plan, plays a critical creditors test role in the confirmation of the plan (the determination by the bankruptcy court that The requirement that the proposed plan meets the confirmation requirements of the Bankruptcy Code). For a Chapter 12 plan to be con creditors holding allowed 11 U.S. C.A. $ 1225(a)(4). d, it must meet the best-interests-of-creditors test. unsecured claims receive, 3. A Sample Chapter 12 Plan under Chapters 11, 12, or 13 plan, an amount not less Chapter 12 plans vary from district to district. Exhibit 7-4 is a sample Chapter 12 plan. than what they would have The attorney's comments follow on why the plan was drafted as it was: received if the bankruptcy estate were liquidated EXHIBIT 7-4 The Chapter 12 Plan under Chapter 7. IN THE UNITED STATES BANKRUPTCY COURT FOR THE NORTHERN DISTRICT OF OKLAHOMA In re OLIVER, Ronald Milton Debtor. Case No: xx-xxxx [Address] (Chapter 12) Last four digits of Social Security No.: Employer's Tax Identification No: CHAPTER 12 PLAN The Debtor submits this Chapter 12 Plan ("the Plan") pursuant to 11 U.S.C.A. $ 1221: I. Income Subject to the Supervision and Control of the Trustee and Duration of the Plan. The Debtor shall pay to the Chapter 12 trustee all disposable income as defined in 11 U.S.C.A. $ 1225(b)(2) for a period of 3 years from the effective date. II. Classification of Claims. Class 1: Administrative Claims. The costs and expenses associated with this bankruptcy case allowable under 11 U.S.C.A. $ 503 and entitled to priority under 11 U.S.C.A. $ 507(a)(2), in- cluding the fees of the Chapter 12 trustee pursuant to 12 U.S.C.A. $ 586(e). The administrative claims include the fees and expenses of the professionals employed in this case, including the attorney and accountant. Class 2: Other Priority Claims. Claims entitled to priority under 11 U.S.C.A. $ 507(a) other than Class 1 administrative claims. These claims include the claim of the Internal Revenue Service in the amount of $8,000, the claim of the Oklahoma Tax Commission in the amount of $4,500, and the claim of the Craig County Treasurer in the amount of $850. (continued)