--- kind: "section" citation: "11 U.S.C. § 1232" title: "11" title_heading: "Bankruptcy" number: "1232" heading: "Claim by a governmental unit based on the disposition of property used in a farming operation" release: "119-102" date: "2026-07-12" url: "https://uscodex.org/usc/11/1232" units: - "Chapter 12 — Adjustment of Debts of a Family Farmer or Fisherman with Regular Annual Income" - "Subchapter II — The Plan" --- # §1232. Claim by a governmental unit based on the disposition of property used in a farming operation - (a) Any unsecured [claim](/usc/11/101.md?p=5) of a [governmental unit](/usc/11/101.md?p=27) against the [debtor](/usc/11/101.md?p=13) or the estate that arises before the filing of the [petition](/usc/11/101.md?p=42), or that arises after the filing of the [petition](/usc/11/101.md?p=42) and before the [debtor](/usc/11/101.md?p=13)’s discharge under [section 1228](/usc/11/1228.md), as a result of the sale, [transfer](/usc/11/101.md?p=54), exchange, or other disposition of any property used in the [debtor](/usc/11/101.md?p=13)’s [farming operation](/usc/11/101.md?p=21)— - (1) shall be treated as an unsecured [claim](/usc/11/101.md?p=5) arising before the date on which the [petition](/usc/11/101.md?p=42) is filed; - (2) shall not be entitled to priority under [section 507](/usc/11/507.md); - (3) shall be provided for under a plan; and - (4) shall be discharged in accordance with section 1228. - (b) For purposes of applying sections [1225(a)(4)](/usc/11/1225.md?p=a-4), [1228(b)(2)](/usc/11/1228.md?p=b-2), and [1229(b)(1)](/usc/11/1229.md?p=b-1) to a [claim](/usc/11/101.md?p=5) described in [subsection (a)](#a) of this section, the amount that would be paid on such [claim](/usc/11/101.md?p=5) if the estate of the [debtor](/usc/11/101.md?p=13) were liquidated in a case under [chapter 7](/usc/11/chch7.md) of this title shall be the amount that would be paid by the estate in a [chapter 7](/usc/11/chch7.md) case if the [claim](/usc/11/101.md?p=5) were an unsecured [claim](/usc/11/101.md?p=5) arising before the date on which the [petition](/usc/11/101.md?p=42) was filed and were not entitled to priority under section 507. - (c) For purposes of applying sections [523(a)](/usc/11/523.md?p=a), [1228(a)(2)](/usc/11/1228.md?p=a-2), and [1228(c)(2)](/usc/11/1228.md?p=c-2) to a [claim](/usc/11/101.md?p=5) described in [subsection (a)](#a) of this section, the [claim](/usc/11/101.md?p=5) shall not be treated as a [claim](/usc/11/101.md?p=5) of a kind specified in subparagraph [(A)](/usc/11/523.md?p=a-1-A) or [(B)](/usc/11/523.md?p=a-1-B) of section 523(a)(1). - (d) - (1) A [governmental unit](/usc/11/101.md?p=27) may file a proof of [claim](/usc/11/101.md?p=5) for a [claim](/usc/11/101.md?p=5) described in [subsection (a)](#a) that arises after the date on which the [petition](/usc/11/101.md?p=42) is filed. - (2) If a [debtor](/usc/11/101.md?p=13) files a tax return after the filing of the [petition](/usc/11/101.md?p=42) for a period in which a [claim](/usc/11/101.md?p=5) described in [subsection (a)](#a) arises, and the [claim](/usc/11/101.md?p=5) relates to the tax return, the [debtor](/usc/11/101.md?p=13) shall serve notice of the [claim](/usc/11/101.md?p=5) on the [governmental unit](/usc/11/101.md?p=27) charged with the responsibility for the collection of the tax at the address and in the manner designated in [section 505(b)(1)](/usc/11/505.md?p=b-1). Notice under this paragraph shall [state](/usc/11/101.md?p=52) that the [debtor](/usc/11/101.md?p=13) has filed a [petition](/usc/11/101.md?p=42) under this chapter, [state](/usc/11/101.md?p=52) the name and location of the court in which the case under this chapter is pending, [state](/usc/11/101.md?p=52) the amount of the [claim](/usc/11/101.md?p=5), and include a copy of the filed tax return and documentation supporting the calculation of the [claim](/usc/11/101.md?p=5). - (3) If notice of a [claim](/usc/11/101.md?p=5) has been served on the [governmental unit](/usc/11/101.md?p=27) in accordance with [paragraph (2)](#d-2), the [governmental unit](/usc/11/101.md?p=27) may file a proof of [claim](/usc/11/101.md?p=5) not later than 180 days after the date on which such notice was served. If the [governmental unit](/usc/11/101.md?p=27) has not filed a timely proof of the [claim](/usc/11/101.md?p=5), the [debtor](/usc/11/101.md?p=13) or trustee may file proof of the [claim](/usc/11/101.md?p=5) that is consistent with the notice served under [paragraph (2)](#d-2). If a proof of [claim](/usc/11/101.md?p=5) is filed by the [debtor](/usc/11/101.md?p=13) or trustee under this paragraph, the [governmental unit](/usc/11/101.md?p=27) may not amend the proof of [claim](/usc/11/101.md?p=5). - (4) A [claim](/usc/11/101.md?p=5) filed under this subsection shall be determined and shall be allowed under subsection [(a)](/usc/11/502.md?p=a), [(b)](/usc/11/502.md?p=b), or [(c)](/usc/11/502.md?p=c) of section 502, or disallowed under subsection [(d)](/usc/11/502.md?p=d) or [(e)](/usc/11/502.md?p=e) of section 502, in the same manner as if the [claim](/usc/11/101.md?p=5) had arisen immediately before the date of the filing of the [petition](/usc/11/101.md?p=42). ## Source credit (Added Pub. L. 115–72, div. B, § 1005(a), Oct. 26, 2017, 131 Stat. 1232.) ## Notes ### Statutory Notes and Related Subsidiaries ### Effective Date Section applicable to bankruptcy cases pending on Oct. 26, 2017, in which the plan under this chapter has not been confirmed on Oct. 26, 2017, and relating to which an order of discharge under section 1228 of this title has not been entered, and to bankruptcy cases that commence on or after Oct. 26, 2017, see section 1005(c) of Pub. L. 115–72, set out as an Effective Date of 2017 Amendment note under section 1222 of this title.