Insolvent Probate Estate Claim-Payment Priority in Wisconsin
At a glance
| Statutory payment order | § 859.25(1) classifies allowed claims and allowances into eight ordered classes when applicable assets are insufficient. |
|---|---|
| Administration costs | Costs and expenses of administration first (§ 859.25(1)(a)). |
| Funeral and last illness | Reasonable funeral and burial expenses second; reasonable and necessary last-sickness expenses, including attendants, fourth (§ 859.25(1)(b),(d)). |
| Family and homestead allowances | Provisions for the decedent's family under §§ 861.31, 861.33, and 861.35 third; property assigned to surviving spouse or domestic partner under § 861.41 seventh (§ 859.25(1)(c),(g)). |
| Taxes and public claims | U.S., state, governmental-subdivision, and municipal debts, charges, or taxes fifth (§ 859.25(1)(e)). |
| Secured claims | § 859.19(2) permits full claim payment on surrender of security or offsets fair value after realization; § 859.43(1) preserves enforcement of mortgage, pledge, lien, or other security against estate property. |
| Support and special debts | Employee wages, pension, welfare, and vacation benefits earned within three months before death sixth, capped at $300 per employee (§ 859.25(1)(f)). |
| General claims | All other allowed claims eighth (§ 859.25(1)(h)). |
| Underfunded class | No preference within a class or for presently payable over not-yet-due claims (§ 859.25(2)); § 859.47 expressly calls for proportional payment of qualifying unfiled claims when insolvent. |
Requirements one by one
Eight payment classes
Section 859.25 applies when the estate's applicable assets will not cover claims and allowances. Administration expenses come first. Funeral and burial are second, specified family provisions third, and reasonable last-sickness care fourth. Public debts and taxes are fifth. Qualifying recent employee compensation comes sixth, with a $300 limit for each employee. The specified spouse or domestic-partner property assignment is seventh; other allowed claims are eighth. The cited § 861.31 and § 861.41 describe the family support allowance and surviving-partner assignment referenced in that ladder.
Secured property and shortfalls
Under § 859.19, surrendering security allows payment on the full claim; realizing on security first reduces payment by its fair value. Under § 859.43, Wisconsin preserves proceedings to enforce a lien or other security against estate property, and permits the representative to pay, renew, or satisfy an encumbrance with the encumbered asset.
Under § 859.25(2), one claim cannot be preferred over another in its class, and a currently payable claim does not jump ahead of one not yet due. Under § 859.47, Wisconsin requires proportional payment of qualifying unfiled claims with other claims of the same class when the estate is insolvent.
What trips people up
Last-sickness expenses are a separate fourth class after family provisions, while funeral and burial are second. The employee class reaches wages and listed benefits earned within three months of death, but only $300 per employee receives that class position.
Common questions
Does the class list extinguish a creditor's lien? No. Section 859.43(1) preserves enforcement proceedings against secured estate property.
Are government claims ahead of last-sickness costs? No. Section 859.25 places last-sickness expenses fourth and the named public claims fifth.
Statutes and sources
- Wis. Stat. §§ 859.19, 859.25, 859.43, and 859.47. Verbatim current official text, URL, 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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