How much money does a chapter 7 bankruptcy trustee make?

Not as much as you would think.  trustee compensation

The court pays a chapter 7 trustee $60 a case out of your $335 filing fee.  This $60 pays for the trustee to review all 60+ pages of your paperwork, conduct the 341 Meeting of Creditors, and file a report in your case.  If you waived the filing fee, then the trustee doesn’t even get his 60 bucks.

So, in short, the trustee gets $60 for your case.

However, the trustee also gets paid out of any non-exempt assets he can take from you and sell off.  If he discovers these assets, he sells them off, pays himself a commission and “administrative fees,” and then the rest goes to your creditors.  The trustee will need to file an application for those additional fees, but it is almost always granted by the court.

The trustee’s compensation is set by statute (below), but it basically follows a sliding scale as follows:

25% of the first $5,000,
10% of any amount between $5,000 and $50,000,
5% of any amount between $50,000 and $1,000,000, and
3% of monies in excess of $1,000,000.

This means that if the trustee discovers your million dollar home in the Cayman Islands, he will make some good money selling it off for your creditors.  However, if you did have an asset like that secret home, you probably shouldn’t have filed bankruptcy.  In general, the trustee’s compensation is not great because the debtors (people filing bankruptcy) don’t really have anything for him to sell off.

11 U.S. Code § 326 – Limitation on compensation of trustee

(a) In a case under chapter 7 or 11, the court may allow reasonable compensation under section 330 of this title of the trustee for the trustee’s services, payable after the trustee renders such services, not to exceed 25 percent on the first $5,000 or less, 10 percent on any amount in excess of $5,000 but not in excess of $50,000, 5 percent on any amount in excess of $50,000 but not in excess of $1,000,000, and reasonable compensation not to exceed 3 percent of such moneys in excess of $1,000,000, upon all moneys disbursed or turned over in the case by the trustee to parties in interest, excluding the debtor, but including holders of secured claims.

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