Insolvent Probate Estate Claim-Payment Priority in Montana
At a glance
| Statutory payment order | Seven ordered claim classes, with allowances separately protected (§§ 72-3-807, 72-3-808). |
|---|---|
| Administration costs | Class 1 costs and expenses of administration (§ 72-3-807(1)(a)). |
| Funeral and last illness | Reasonable funeral and necessary last illness share class 2 (§ 72-3-807(1)(b)). |
| Family and homestead allowances | Homestead and family allowances outrank claims; exempt-property deficiency yields to earlier allowances (§§ 72-2-412–414). |
| Taxes and public claims | Federal and Montana estate taxes class 3; legally preferred debts class 5; other federal/state taxes class 6 (§ 72-3-807(1)(c),(e),(f)). |
| Secured claims | Surrender security for full allowed claim; otherwise deduct its value; representative may address encumbrance (§§ 72-3-811–812). |
| Support and special debts | Current and past-due child support under a support order is class 4 (§ 72-3-807(1)(d)). |
| General claims | All other claims are class 7 (§ 72-3-807(1)(g)). |
| Underfunded class | No same-class preference, including due over not-yet-due claims (§ 72-3-807(2)). |
Requirements one by one
Seven claim classes
Under § 72-3-807(1), funeral and last-illness expenses share the second class, followed by federal and Montana estate taxes. A current support obligation and past-due child support under a support order form the fourth class. Preferred debts and other taxes are separate later classes.
Allowances outside the claim ladder
Under § 72-2-412, the homestead allowance has priority over estate claims. Under § 72-2-414, the statute places family allowance behind homestead but ahead of claims. Under § 72-2-413, the statute gives exempt property claim priority, with deficiency assets yielding to earlier homestead and family allowance payments.
Secured claims
Under § 72-3-811, a creditor who surrenders security uses the full allowed claim for payment; otherwise the statute deducts its value. Under § 72-3-812, the representative may pay an encumbrance, renew the secured obligation, or convey the asset to the creditor in satisfaction when doing so appears best for the estate, even without a filed claim.
What trips people up
Under § 72-3-808, the statute directs the representative to provide for unresolved and still-presentable claims before paying allowed claims after the presentation period. Under § 72-3-807(2), a currently due claim gets no preference over a not-yet-due claim of the same class.
Common questions
Do all taxes share one class? No. Section 72-3-807(1)(c),(f) separates estate taxes from other federal and Montana taxes.
Does a child-support debt rank with ordinary claims? Section 72-3-807(1)(d) places the specified current and past-due obligations in class four.
Statutes and sources
- Mont. Code Ann. §§ 72-3-807–808, 72-3-811–812, and 72-2-412–414. Verbatim official text, section URLs, and access dates appear in the source fields above.
Source links
Every statute quoted above, linked, with the date we checked it.
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