To file Form 425C, the small business Monthly Operating Report, pull your prior month’s bank statements, cash receipts, and disbursement records; complete the questionnaire and cash activity sections; attach Exhibits A through F as applicable; sign under penalty of perjury; and submit the PDF through the court’s CM/ECF system by the 21st of the following month. The report gives the U.S. Trustee and your creditors a monthly read on whether your Chapter 11 reorganization is working.
Who Has to File This Form
Form 425C applies to two groups of Chapter 11 debtors. The first is any “small business debtor” under federal bankruptcy law — generally, a business whose total noncontingent, liquidated debts (excluding debts owed to affiliates or insiders) do not exceed a periodically adjusted cap, set at $3,424,000 as of April 1, 2025, with at least half of those debts arising from the debtor’s commercial activities.1Office of the Law Revision Counsel. 11 USC 101 – Definitions Businesses whose primary activity is owning a single piece of real estate do not qualify.
The second group is debtors who elect to reorganize under Subchapter V. Under 11 U.S.C. § 1187, Subchapter V debtors must comply with the reporting duties of § 308 and § 1116, which means filing Form 425C each month before plan confirmation.2Office of the Law Revision Counsel. 11 USC 1187 – Duties and Reporting Requirements of Debtors Both groups are exempt from UST Form 11-MOR, which covers larger Chapter 11 cases.3United States Department of Justice. Chapter 11 Operating Reports
Skipping or botching these filings is dangerous. Under 11 U.S.C. § 1112, an “unexcused failure to satisfy timely any filing or reporting requirement” is cause to convert the case to Chapter 7 or dismiss it.4Office of the Law Revision Counsel. 11 USC 1112 – Conversion or Dismissal
Download the Blank Form
The current PDF is a free download from the United States Courts website.5United States Courts. Monthly Operating Report for Small Business Under Chapter 11 You can fill the fields on screen before printing or e-filing. The base form runs a few pages; your completed packet will be longer once the exhibits are attached.
What to Gather Before You Open the Form
Pull these records first. A missing document can delay filing or draw questions from the U.S. Trustee.
- Bank statements for every open account, including your debtor-in-possession (DIP) accounts. Redacted copies attach at the end of the report.
- A cash receipts log listing all money received during the month — collections on receivables, credit card deposits, cash from customers, and any loans or payments made on your behalf. This becomes Exhibit C.
- A disbursements log with the date, payee, purpose, and amount of every payment, including checks that have not yet cleared, debit card transactions, and payments others made on your behalf. This becomes Exhibit D.
- A list of post-petition debts (including taxes) incurred since the filing date that remain unpaid. This becomes Exhibit E.
- An accounts receivable list covering both pre- and post-petition amounts owed to you. This becomes Exhibit F.
- Proof that all required tax returns are filed and all post-petition tax deposits are current.
- Proof that general liability, workers’ compensation, and any other required insurance remains active with premiums paid.
Completing the Questionnaire
The first part of Form 425C is a series of yes-or-no compliance questions. The U.S. Trustee reads them closely, and a wrong answer without explanation can prompt a motion.
Lines 1 through 9 ask whether you are meeting your core post-petition obligations: that all business receipts are flowing into your DIP accounts, that tax returns are filed and taxes paid, and that insurance premiums are current. A “no” to any of these requires a written explanation attached as Exhibit A.6United States Courts. Official Form 425C – Monthly Operating Report for Small Business Under Chapter 11
Lines 10 through 18 flag potential problems: non-DIP bank accounts, canceled insurance policies, borrowed money, payments made on your behalf, and asset sales or transfers outside the ordinary course. A “yes” to any of these requires an explanation attached as Exhibit B.6United States Courts. Official Form 425C – Monthly Operating Report for Small Business Under Chapter 11 The DIP-account question trips up debtors who kept old accounts open after filing. If any account exists outside your DIP accounts, you need to explain why.
Reporting Cash Activity
You report four numbers that the form uses to calculate your net cash flow and closing balance: total opening cash across all accounts (Line 19), total cash receipts (Line 20), total cash disbursements (Line 21), with net cash flow calculated on Line 22 and the closing cash balance on Line 23.6United States Courts. Official Form 425C – Monthly Operating Report for Small Business Under Chapter 11
For your very first report, Line 19 is the cash on hand as of the bankruptcy filing date, not the first of the calendar month. Every report after that carries the prior month’s closing balance forward.
Two things to watch here. First, the form explicitly tells you not to substitute bank statements for Exhibits C and D. You need the itemized listings. Bank statements go in the additional-information section at the end. Second, your closing cash balance on Line 23 may differ from your bank statement balance because of outstanding checks and deposits in transit. A small gap is normal. A large, unexplained gap will draw questions.
Listing Unpaid Debts and Receivables
Exhibit E lists all post-petition debts that remain unpaid — rent, supplier invoices, tax obligations, anything incurred since the filing date. Exhibit F lists all money customers owe you, both for pre- and post-petition work.6United States Courts. Official Form 425C – Monthly Operating Report for Small Business Under Chapter 11 Together, these two exhibits show whether you are falling further behind or holding your position. A growing stack of unpaid post-petition bills across consecutive reports is one of the clearest signals a reorganization is failing.
Handling Professional Fees
If you paid attorneys, accountants, or other professionals during the month, those payments show up in your disbursements. But professional compensation requires court approval. Under 11 U.S.C. § 331, professionals may apply for interim compensation no more than once every 120 days, and the court must approve amounts before disbursement under § 330.7Office of the Law Revision Counsel. 11 USC 331 – Interim Compensation Listing a fee the court has not yet authorized will draw scrutiny. If a fee application is pending, say so in your explanation rather than treating it as a completed disbursement.
Signing Under Penalty of Perjury
The debtor or an authorized representative signs under penalty of perjury. Knowingly providing false information on a bankruptcy document is a federal felony under 18 U.S.C. § 152, carrying up to five years in prison and a fine.8Office of the Law Revision Counsel. 18 USC 152 – Concealment of Assets; False Oaths and Claims; Bribery Reconcile your disbursement log against your bank records before signing. Rounding errors are fixable. Concealed transfers and inflated receipts are not.
Filing Through CM/ECF
You submit the completed form and all exhibits electronically through the Case Management/Electronic Case Files (CM/ECF) system, the federal judiciary’s online filing portal.9United States Courts. Electronic Filing (CM/ECF) Your attorney logs in with a court-issued username and password, uploads the PDF, and associates it with your case docket.
If you are representing yourself, access depends on your district. Some bankruptcy courts register pro se debtors for CM/ECF accounts; many do not. Call your local bankruptcy clerk’s office to find out whether you can file electronically or need to submit paper. Districts that do not allow pro se e-filing accept filings by mail or at the clerk’s window.
When It’s Due
Unless a local rule says otherwise, Form 425C is due no later than the 21st day of the month after the reporting period. A January report, for example, is due by February 21.10United States Bankruptcy Court. Notice Regarding the UST Programs New Chapter 11 Periodic Reports Effective June 21, 2021 If the 21st falls on a Saturday, Sunday, or legal holiday, Federal Rule of Bankruptcy Procedure 9006(a) pushes the deadline to the next business day.11Office of the Law Revision Counsel. 11 USC App Rule 9006 – Time
Check your district’s local rules early. Some courts set a different deadline or require additional local reporting forms alongside Form 425C. Missing the deadline, even by a few days without leave of court, gives any party in interest grounds to move for conversion or dismissal under § 1112.
What Happens After You File
Once the report hits the docket, the U.S. Trustee’s office reviews it for signs of trouble: shrinking cash balances, growing post-petition debts, missed tax payments, lapsed insurance, or unauthorized asset transfers. Creditors can pull the filing from PACER.
If the U.S. Trustee sees a problem, the first contact is usually informal, often a letter or call asking for clarification. Persistent issues lead to formal action: a motion to appoint a Chapter 11 trustee to take over operations, a motion to convert the case to Chapter 7, or a motion to dismiss the case. Late filings follow the same escalation path. The monthly report is your main tool for showing the court that the business is viable and the plan is on track.
Tax Compliance Is a Core Question
Form 425C asks directly whether you have filed all required tax returns and paid all post-petition taxes on time. Lines 6 and 7 of the questionnaire treat this as a core compliance item, and 11 U.S.C. § 308 separately requires reporting on whether you are “timely filing tax returns and other required government filings and paying taxes and other administrative expenses when due.”12Office of the Law Revision Counsel. 11 USC 308 – Debtor Reporting Requirements
Payroll taxes deserve particular attention. When you withhold income tax and FICA from employee paychecks, those funds are held in trust for the government. If they go unpaid, the IRS can assess a trust fund recovery penalty equal to the full unpaid amount, and that penalty is nondischargeable. It also attaches personally to any “responsible person” with authority to ensure the taxes were paid, regardless of whether the business is an LLC or corporation. Falling behind on payroll tax deposits during a Chapter 11 case is one of the most common reasons the U.S. Trustee moves to shut down a reorganization.
Reporting After Plan Confirmation
Form 425C covers the period before your reorganization plan is confirmed. Once the court confirms a plan, reporting requirements change but do not necessarily end. Contact the U.S. Trustee’s office in your district to find out what post-confirmation reports apply.3United States Department of Justice. Chapter 11 Operating Reports Some districts require continued monthly or quarterly reporting until the case closes; others use their own local forms. Do not assume confirmation means you can stop filing.