Proof of Claim

By 
DANIEL KURT
 
 
Updated Jun 28, 2021
A proof of claim is a form submitted by a creditor in order to receive money from
a debtor that has filed for bankruptcy. The document provides notice of the claim
to all of the other relevant parties in the bankruptcy, including the court, the
debtor, and other creditors.1

Typically, all creditors, whether they are owed secured or unsecured debts,

should file a proof of claim in order to have a chance for recouping all, or at least
some, of the amount they are due. Creditors could include suppliers that have
sold equipment or other goods to the debtor or parties that have performed a
service and have yet to be paid. 

KEY TAKEAWAYS

 If a business or individual that owes you money files for bankruptcy, you
need to submit a proof of claim to be repaid. 
 Most nongovernment creditors have 70 days from the bankruptcy filing
date to submit the form.
 The court’s acceptance of a proof of claim does not guarantee you will be
repaid; the trustee repays creditors based on the type of debt that is owed,
with whatever funds are available from the bankruptcy estate. 
What Is a Proof of Claim?
When an individual or a business files for bankruptcy, a court clerk notifies any
creditors listed in the filing.2  These include creditors that have sold the debtor
goods, lent them money, rented property to them, or performed a service for
which they have not been paid.3  The bankruptcy court clerk will send these
creditors a Proof of Claim form (Form 410) as well as instructions on how to fill it
out. They also include the deadline for submitting the form, which for most
bankruptcies is 70 days after the bankruptcy filing date.2  For government
creditors the deadline is 180 days.4

By submitting the proof of claim, the creditor is essentially putting their receivable
amount in a queue with other creditors. It’s the job of the bankruptcy trustee to
pay valid claims with the debtor’s available funds, based on their priority
status. Bankruptcies are handled in the federal court system, and creditors
should file their claim in the district handling the debtor’s case.5  Creditors can
obtain a copy of Form 410 on the United States Courts website.3  

While some districts allow unofficial forms, they have to closely resemble the
official one. The request must be in writing and clearly articulate the intent to
make a claim against the bankruptcy estate. Ultimately, the decision of whether
to accept an unofficial proof of claim is left to the discretion of the bankruptcy
judge overseeing the case.4

Generally, those who are owed money by a party filing for Chapter 11, Chapter
12, or Chapter 13 bankruptcy, all of which involve a plan for repaying creditors,
need to file a proof of claim in order to receive any funds.2  You also need to
submit the form if the debtor is filing under Chapter 7, provided that there are
funds available for distribution. In “no-asset” Chapter 7 cases proof of claim isn’t
necessary, because there’s no money to divvy up.6

Filling Out the Form

Form 410 is a three-page document that ordinarily must be completed and
signed by either the creditor, the creditor’s attorney, or an authorized agent. The
information you’ll need to provide includes:3

 The amount of the claim

 The basis for the claim
 Whether the debt is secured by a lien
 The last four digits of the debtor’s account, if applicable 
 Your address for notifications and potential payments  

Along with the form, you should include copies of any documents that support
your claim, such as purchase orders, promissory notes, invoices, account
statements, mortgages, and contracts.3

In addition to mailing the form to the appropriate district court, creditors may also
file electronically, either through the court’s website or via a third-party
bankruptcy claims agent.2   If you want confirmation that the proof of claim has
been filed, you can include a self-addressed envelope along with a copy of the
form in your mailing, or you can visit the court’s Public Access to Court Electronic
Records (PACER) system to see the filed form online.5

What if You Don’t Receive a Form?

For a variety of reasons, a party that owes you money may leave you off the
court filing. That means you won’t receive a notice from the court clerk with your
proof of claim deadline.
If you find out about the bankruptcy through an unofficial source, you should
contact the individual or business that owes you money and ask for their
bankruptcy case number. You can then call the clerk for the district court
handling their case to have them verify the filing and ask for the proof of claim
deadline.7  You can either access the form online or request that the clerk send
you one through the mail.

 
Secured debts are prioritized for repayment over unsecured debts in a
bankruptcy proceeding.

Prioritizing Debts
Once you file a proof of claim, it’s typically accepted by the court unless the
trustee, debtor, or another “party in interest”—that is, one with a financial stake in
the case—objects to it. This can happen, for example, if the creditor listed an
incorrect amount or falsely identified the amount as a secured debt when there’s
no lien involved.4  If the proof of claim is accepted by the court, that doesn’t mean
the full amount will be paid to the creditor. Based on the available funds, the
trustee’s role is to repay creditors based on the type of debt.

Secured debts, such as mortgages and car loans, have a special status.8  Even if
the court were to discharge these debts, the lien holder has the legal right to
confiscate the property and sell it. Unsecured debts are lower in the pecking
order, although so-called priority debts—including child support, alimony, and
unpaid income taxes less than three years old—are paid before other unsecured
debts, such as utility bills and credit card balances. If the bankruptcy estate
doesn’t have enough funds to make all the creditors whole, which is common, an
unsecured creditor may receive pennies on the dollar or possibly nothing at all.