11 U.S.C. Section 101 -- Definitions in the Bankruptcy Code

What Is Section 101?

Section 101 of Title 11 of the United States Code (Definitions) is a foundational provision of the Bankruptcy Code. It defines key terms used throughout the Bankruptcy Code. Understanding these definitions is essential because courts interpret the Code strictly based on how terms are defined in Section 101.

Key Provisions of Section 101

Critical definitions include:

• Claim (101(5)): A right to payment, whether or not such right is reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed, or undisputed. This extremely broad definition means virtually every type of debt is a "claim" in bankruptcy.
• Creditor (101(10)): An entity that has a claim against the debtor that arose before the order for relief.
• Debt (101(12)): Liability on a claim.
• Debtor (101(13)): A person concerning whom a case has been commenced.
• Household goods (101(27)): Specifically enumerated items: clothing, furniture, appliances, one computer, one TV, and linens. Notably excludes works of art, antiques, and electronic entertainment equipment beyond one of each.
• Insolvent (101(32)): Financial condition such that the sum of debts is greater than all property at fair valuation.
• Regular income (101(30)): Income sufficiently stable and regular to enable a debtor to make payments under a Chapter 13 plan. Includes wages, Social Security, pensions, and even some welfare benefits.

How This Affects You

Why definitions matter in practice:

• Household goods: The narrow definition limits what a debtor can claim under the household goods exemption. Collectors' items, electronic equipment beyond one TV/computer, and musical instruments (unless you are a professional musician) are excluded.
• Regular income: This definition determines Chapter 13 eligibility. Courts have found that Social Security alone, pensions, and even sporadic self-employment income can qualify as "regular income."
• Claim breadth: The broad definition of "claim" means that virtually every obligation -- even contingent, disputed, or unliquidated ones -- is swept into the bankruptcy case. This is both a benefit (comprehensive debt relief) and a risk (liabilities you did not know about may be affected).

Related Bankruptcy Code Sections

Section 101 works in conjunction with several other provisions of the Bankruptcy Code:

• Section 109 -- Uses definitions from 101
• Section 521 -- Debtor duties reference 101 terms

Understanding how these sections interact is critical for anyone navigating the bankruptcy process, whether as a debtor, creditor, or attorney.