Insolvent Probate Estate Claim-Payment Priority in Tennessee
At a glance
| Statutory payment order | Four classes; each earlier class must be satisfied or provided for before the next (§ 30-2-317(a)–(b)). |
|---|---|
| Administration costs | First: administration costs, including fiduciary-bond premiums and reasonable representative and counsel compensation (§ 30-2-317(a)(1)). |
| Funeral and last illness | Second: reasonable funeral expenses; no separate last-illness class or fixed cap in this priority list (§ 30-2-317(a)(2)–(4)). |
| Family and homestead allowances | No separate family or homestead allowance class in the four-class claim list (§ 30-2-317(a)). |
| Taxes and public claims | Third: federal, state, and local government taxes and assessments, including TennCare claims under § 71-5-116 (§ 30-2-317(a)(3)). |
| Secured claims | Court-ordered early payment permitted for a secured debt facing harmful foreclosure; § 30-2-318(a) does not create a separate secured class. |
| Support and special debts | TennCare claims expressly included in class three; no separate support or wage class in the four-class list (§ 30-2-317(a)(3)–(4)). |
| General claims | Fourth: all other demands filed within four months after notice to creditors (§ 30-2-317(a)(4)). |
| Underfunded class | Pay an underfunded class pro rata; reserve proper ratable shares for contested or unmatured claims (§ 30-2-317(b), (d)). |
Requirements one by one
Administration expenses
Section 30-2-317(a)(1) expressly includes fiduciary-bond premiums and reasonable compensation for the representative and counsel in the first class. Its list is introduced with “including, but not limited to,” so those examples do not exhaust administration expenses.
Secured debts
Under § 30-2-318(a), a court may order early payment of a secured debt when threatened foreclosure would harm the estate. That is a limited payment route, not a fifth claim class. Section 30-2-318(b) makes the representative and sureties liable for each creditor's ratable share if other debts are paid early on an assumption of solvency and the estate proves insolvent.
Same-class shortfall
Section 30-2-317(b) requires pro rata payment when one class cannot be paid in full. Under § 30-2-317(d), the representative must also reserve funds or assets for contested or unmatured claims, including the proper ratable portion where applicable.
What trips people up
Under § 30-2-317(a)(2), reasonable funeral expenses are second. Under § 30-2-317(a)(3) puts government taxes and assessments in class three, including TennCare claims and city and county governments. Under § 30-2-317(a)(4) limits the fourth class to other demands filed within four months after notice to creditors; the separate claim-deadline rules determine timeliness. Reasonable last-illness expenses have no separate preferred class in this four-class list.
Common questions
Can the representative pay a later class before an earlier one is fully paid? Section 30-2-317(b) says an earlier class must first be satisfied or provided for.
Is there a family allowance class in the claim list? Section 30-2-317(a) lists four claim classes and none is a family or homestead allowance. Allowance entitlement is a separate question.
Statutes and sources
- Tenn. Code Ann. §§ 30-2-317(a)–(b), (d), and 30-2-318(a)–(b), with the 1997, 2001, 2006, and 2014 official amendment acts. Verbatim text, 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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