Exceptions to the Automatic Stay - 11 USC 362(b) [2026]

Reading Section 362(b)

Section 362(b) excepts particular acts from what would otherwise be stayed under Section 362(a). The exceptions are enumerated by number and have grown over time. The 1978 Code contained nine; today there are more than 28, the result of repeated congressional accretion in 1984, 1994, 1998, 2005, and later years. Each exception is narrowly drawn and must be read against the broad sweep of Section 362(a).

Two interpretive principles guide application of the exceptions. First, because they are exceptions to a remedial statute that protects debtors and the estate, they are typically construed narrowly. Second, an exception negates the stay only as to the precise conduct it authorizes; an act that is partly within and partly outside an exception is treated as a stay violation to the extent it exceeds the exception's reach.

Official citation: 11 U.S.C. § 362(b)(1)-(28)

Criminal Proceedings: Section 362(b)(1)

Section 362(b)(1) excepts "the commencement or continuation of a criminal action or proceeding against the debtor." Indictment, prosecution, trial, sentencing, and incarceration are all unaffected by the bankruptcy filing. The exception is broad enough to reach criminal restitution orders that arise from the prosecution, although courts distinguish bona fide criminal proceedings from proceedings whose dominant purpose is debt collection. A criminal-bad-check prosecution that is in substance a creditor's collection effort may not qualify if the record shows the prosecution was instigated by and effectively controlled by the private creditor.

Criminal restitution orders entered post-petition are not stayed; they are also generally nondischargeable under Section 523(a)(7) for individual debtors in Chapter 7 and Chapter 13 (subject to that section's framework).

Family-Law Matters: Section 362(b)(2)

Section 362(b)(2) collects several family-law exceptions. The stay does not bar:

Establishment of paternity (Section 362(b)(2)(A)(i)).
Establishment or modification of an order for domestic support obligations (Section 362(b)(2)(A)(ii)).
Determinations of child custody or visitation (Section 362(b)(2)(A)(iii)).
Dissolution of marriage, except to the extent the dissolution would determine the division of property that is property of the estate (Section 362(b)(2)(A)(iv)).
Proceedings regarding domestic violence (Section 362(b)(2)(A)(v)).
Collection of a domestic-support obligation from property that is not property of the estate (Section 362(b)(2)(B)).
Withholding of income for payment of a domestic-support obligation under a judicial or administrative order (Section 362(b)(2)(C)).
Withholding, suspension, or restriction of a driver's license, a professional or occupational license, or a recreational license (Section 362(b)(2)(D)).
Reporting of overdue support owed by a parent to a consumer-reporting agency (Section 362(b)(2)(E)).
Interception of a tax refund (Section 362(b)(2)(F)).
Enforcement of a medical-support obligation (Section 362(b)(2)(G)).

The exception for division of property carries an important limitation: although the dissolution proceeding may continue, the actual division of property of the estate must yield to the bankruptcy court's jurisdiction. Domestic-relations courts therefore typically reserve property-division issues pending stay relief or pending closure of the bankruptcy case.

Tax Assessments and Demands: Section 362(b)(9)

Section 362(b)(9) excepts certain governmental tax determinations and demands. Specifically:

An audit by a governmental unit to determine tax liability (Section 362(b)(9)(A)).
The issuance to the debtor of a notice of tax deficiency (Section 362(b)(9)(B)).
A demand for tax returns (Section 362(b)(9)(C)).
The making of an assessment for any tax and the issuance of a notice and demand for payment, provided that a tax lien arising from such assessment does not attach to property of the estate while the case is pending and any setoff of an income tax refund is subject to Section 362(b)(26) (Section 362(b)(9)(D)).

Although assessment may proceed, collection (levy, seizure, lien filing) remains stayed. The exception thus permits the tax clock to keep running for purposes of Section 507(a)(8) priorities and Section 523(a)(1) dischargeability analysis without permitting active collection.

Police and Regulatory Power: Section 362(b)(4)

Section 362(b)(4) excepts "the commencement or continuation of an action or proceeding by a governmental unit or any organization exercising authority under the Convention on the Prohibition of the Development, Production, Stockpiling and Use of Chemical Weapons... to enforce such governmental unit's or organization's police and regulatory power, including the enforcement of a judgment other than a money judgment, obtained in an action or proceeding by the governmental unit to enforce such governmental unit's or organization's police or regulatory power." Money-judgment enforcement (the actual seizure or levy) remains stayed; the underlying proceeding and entry of judgment are not.

Courts apply two complementary tests to determine whether a governmental action qualifies. The pecuniary purpose test asks whether the action is primarily intended to protect a pecuniary interest of the government rather than public safety or welfare. The public policy test asks whether the action is primarily intended to effectuate public policy rather than to adjudicate private rights. Enforcement of environmental laws, consumer-protection statutes, and labor laws typically qualifies. Pure tax-collection litigation typically does not.

Securities Self-Regulatory Actions: Section 362(b)(7)

Section 362(b)(7) excepts the commencement or continuation of an action or proceeding by a securities self-regulatory organization to enforce its regulatory power. The Financial Industry Regulatory Authority, national securities exchanges, and similar bodies may proceed with disciplinary actions, suspensions, expulsions, and arbitration of customer disputes notwithstanding the debtor's bankruptcy. The exception does not extend to enforcement of money judgments. Related exceptions in (b)(6) (commodity-broker setoffs), (b)(17) (swap-agreement setoffs), and (b)(27) (master netting agreements) protect financial-market participants from the stay's reach in narrowly defined contexts.

Multiple-Filing Exceptions: Section 362(b)(20)-(23)

Congress added Sections 362(b)(20) through 362(b)(23) in 2005 as part of a broader effort to limit repeat filings.

Section 362(b)(20): In Rem Order Bar

Subsection (b)(20) provides that no stay arises with respect to real property as to which a court has entered an order under Section 362(d)(4) within the previous two years, finding that the filing was part of a scheme to delay, hinder, or defraud creditors. The (d)(4) order is recorded against the property, and a subsequent filer cannot invoke the stay as to that property without obtaining bankruptcy-court relief.

Section 362(b)(21): Ineligible Debtor

Subsection (b)(21) provides that no stay arises as to a debtor who is ineligible under Section 109(g) (because of dismissal within the preceding 180 days for willful failure to abide by court orders or after a request for stay relief) or as to a debtor who filed in violation of an order in a prior case prohibiting refiling.

Section 362(b)(22) and (b)(23): Residential Eviction Carve-Outs

Subsection (b)(22) excepts certain residential evictions where the landlord has obtained a pre-petition judgment for possession, subject to the Section 362(l) cure procedure that permits the debtor to certify intent to cure and deposit one month's rent. Subsection (b)(23) excepts evictions based on endangerment of the property or illegal use of controlled substances on the premises.

Other Frequently Encountered Exceptions

Section 362(b)(3): Acts to perfect, maintain, or continue the perfection of an interest in property to the extent permitted by Section 546(b) or 547(e)(2)(A).
Section 362(b)(10): Acts by a lessor of nonresidential real property to obtain possession after expiration of the stated term of the lease.
Section 362(b)(11): Presentment of a negotiable instrument and giving notice of dishonor.
Section 362(b)(18): Creation or perfection of a statutory lien for an ad valorem property tax or special tax or special assessment.
Section 362(b)(19): Withholding from wages for repayment of pension-plan loans under ERISA-qualified plans.
Section 362(b)(26): Setoff of an income tax refund for a pre-petition taxable period against pre-petition tax liabilities, subject to specified conditions.
Section 362(b)(28): Exclusion of the debtor from participation in Medicare or other federal health-care programs under specified authority.

Burden of Proof and Litigation Posture

The party seeking to invoke an exception bears the burden of demonstrating that its conduct falls within the exception's text. Because the exceptions are construed narrowly, close calls typically resolve in favor of the stay. A creditor uncertain whether an exception applies may file a "comfort order" motion under Section 362(j) requesting the court to confirm that the stay does not bar specified conduct. Comfort orders are particularly common in police-and-regulatory cases where the line between welfare enforcement and pecuniary enforcement is contested.

Practical note: An act that clearly falls outside the stay does not require any order. But proceeding under a contested exception without seeking either a comfort order or actual stay relief invites a Section 362(k) damages action if a court later disagrees with the creditor's reading of the exception.

Interaction With Section 105(a) and General Equitable Authority

Even when conduct falls within a Section 362(b) exception, the bankruptcy court retains authority under Section 105(a) to issue any order necessary or appropriate to carry out the provisions of the Bankruptcy Code. This includes the power to enjoin conduct that would otherwise be permitted by an exception, where the court finds that the conduct threatens the orderly administration of the estate or the debtor's ability to reorganize. The Section 105 injunction is discretionary and requires a separate showing under the traditional preliminary-injunction factors; it is not automatic in the way the Section 362 stay is automatic. Creditors operating within a (b) exception should monitor case-administration developments for any (105(a)) supplemental injunction that may apply to their conduct.

Conversely, Section 105(a) cannot be used to expand the scope of Section 362 beyond its statutory reach. The Supreme Court in Law v. Siegel, 571 U.S. 415 (2014), confirmed that Section 105 cannot be used to override express statutory provisions. The Section 362(b) exceptions are statutory carve-outs that the bankruptcy court must respect in their plain terms.

Notice Requirements Within Exceptions

Several Section 362(b) exceptions carry their own notice or procedural requirements. The residential-eviction exceptions in (b)(22) and (b)(23) interact with Section 362(l), which permits the debtor to file with the petition a certification that the debtor has a right under applicable nonbankruptcy law to cure the monetary default and to deposit with the clerk any rent that would become due during the 30 days after filing. If the debtor properly invokes (l), the stay applies and the landlord must file an objection to terminate the protection. The (l) procedure illustrates a recurring pattern in which Congress has paired an exception with a debtor-protective override mechanism that must be invoked through specific paperwork.

Similarly, the domestic-support exceptions in (b)(2)(B) through (b)(2)(G) often interact with state-court procedures that have their own notice and hearing requirements. A state child-support enforcement agency that intends to suspend a driver's license under (b)(2)(D) must satisfy applicable state-law notice procedures even though the bankruptcy stay does not apply.

Exceptions and Exclusions Section 362(b)