Chapter 13 Bankruptcy: What is TRCC?

In North Texas bankruptcy cases, TRCC stands for “Trustee’s Recommendation Concerning Claims.” This is the point in a Chapter 13 bankruptcy case when the trustee reviews the claims filed in the case and decides if the plan provides enough money to pay all allowed claims. This concept will make more sense if I start my explanation at the time the case is filed.

Every Chapter 13 debtor has to file a plan with their bankruptcy petition. This plan details how the debtor proposes to resolve each of the creditor’s claims. At the time the case is filed, the debtor doesn’t know the exact amount of each claim, so he estimates what he owes to each creditor. Sometimes the estimate is too low and sometimes it is too high. In fact, these estimates are almost never exactly right, but that is okay; the amount will get fixed later at TRCC.

About three months into the case the plan is set for confirmation. Confirmation is the point at which the plan is approved by the Court. However, at confirmation the exact amount of the claims is still not resolved. In order to establish the correct claim amounts, creditors file proof of their claims with the court. Secured and unsecured creditors are required to file these claims within 90 days following the date they meet with the trustee which occurs about six weeks after the case is filed. Governmental agencies have 180 days following the filing date of the bankruptcy case to file their claims. This deadline is important because creditors that don’t file claims don’t get paid by the trustee.

If you have been reading closely you may have noticed that confirmation occurs before the deadline to file claims, so the case is approved by the court before the exact amounts of the claims are known. That is where TRCC comes in. At TRCC the trustee reviews each of the claims and determines whether the plan provides enough money to pay them all. If the total claims are less than the amount provided in the plan then the debtor may be able to modify the plan to reduce the duration or payment amount. But if the claims come in higher than estimated in the original plan, then the plan may need to be modified to increase the plan payment to make the plan sufficient.