§1225. Confirmation of plan

(a) Except as provided in subsection (b), the court shall confirm a plan if-

(1) the plan complies with the provisions of this chapter and with the other applicable provisions of this title;

(2) any fee, charge, or amount required under chapter 123 of title 28, or by the plan, to be paid before confirmation, has been paid;

(3) the plan has been proposed in good faith and not by any means forbidden by law;

(4) the value, as of the effective date of the plan, of property to be distributed under the plan on account of each allowed unsecured claim is not less than the amount that would be paid on such claim if the estate of the debtor were liquidated under chapter 7 of this title on such date;

(5) with respect to each allowed secured claim provided for by the plan-

(A) the holder of such claim has accepted the plan;

(B)(i) the plan provides that the holder of such claim retain the lien securing such claim; and

(ii) the value, as of the effective date of the plan, of property to be distributed by the trustee or the debtor under the plan on account of such claim is not less than the allowed amount of such claim; or

(C) the debtor surrenders the property securing such claim to such holder; and

(6) the debtor will be able to make all payments under the plan and to comply with the plan.

(b)(1) If the trustee or the holder of an allowed unsecured claim objects to the confirmation of the plan, then the court may not approve the plan unless, as of the effective date of the plan-

(A) the value of the property to be distributed under the plan on account of such claim is not less than the amount of such claim; or

(B) the plan provides that all of the debtor's projected disposable income to be received in the three-year period, or such longer period as the court may approve under section 1222(c), beginning on the date that the first payment is due under the plan will be applied to make payments under the plan.

(2) For purposes of this subsection, "disposable income" means income which is received by the debtor and which is not reasonably necessary to be expended-

(A) for the maintenance or support of the debtor or a dependent of the debtor; or

(B) for the payment of expenditures necessary for the continuation, preservation, and operation of the debtor's business.

(c) After confirmation of a plan, the court may order any entity from whom the debtor receives income to pay all or any part of such income to the trustee.

(Added and amended Pub. L. 99–554, title II, §255, title III, §302(f), Oct. 27, 1986, 100 Stat. 3110 , 3124; Pub. L. 105–277, div. C, title I, §149(a), Oct. 21, 1998, 112 Stat. 2681–610 ; Pub. L. 106–5, §1(1), (2), Mar. 30, 1999, 113 Stat. 9 ; Pub. L. 106–70, §1, Oct. 9, 1999, 113 Stat. 1031 .)

Termination of Section

For termination of reenactment of this section by section 149(a) of Pub. L. 105–277, as amended, see Repeal, Reenactment, and Termination of Chapter note set out under section 1201 of this title.

Codification

Section repealed effective Oct. 1, 1998, by Pub. L. 99–554, title III, §302(f), Oct. 27, 1986, 100 Stat. 3124 , as amended by Pub. L. 103–65, §1, Aug. 6, 1993, 107 Stat. 311 . Section, as in effect on Sept. 30, 1998, reenacted by Pub. L. 105–277, div. C, title I, §149(a), Oct. 21, 1998, 112 Stat. 2681–610 , for the period beginning on Oct. 1, 1998, and ending on Apr. 1, 1999. Pub. L. 105–277, §149(a), as subsequently amended by Pub. L. 106–5 and Pub. L. 106–70, provided that this section, as in effect on Sept. 30, 1999, is reenacted for the period beginning on Oct. 1, 1999, and ending on July 1, 2000. See Repeal, Reenactment, and Termination of Chapter note set out under section 1201 of this title.

Section Referred to in Other Sections

This section is referred to in sections 347, 1208, 1222, 1229, 1230, 1231 of this title.