Crofton, MD asked in Probate for Maryland

Q: In a small estate filing, if allowable costs exceed the value of the assets, do estate creditors have to be paid?

Estate assets total $11,552. Allowable funereal expenses are $4,398, applicable family allowances are $10,0000 and filing fee is $100 for total expenses of $14,498. Estate assets are $2,946 less than allowable expenses.

Related Topics:
1 Lawyer Answer
Mark Oakley
Mark Oakley
Answered
  • Estate Planning Lawyer
  • Rockville, MD
  • Licensed in Maryland

A: Section 8-105 of the Estates & Trusts Code governs priority of payments from an estate:(a) If the applicable assets of the estate are insufficient to pay all claims in full, the personal representative shall make payment in the following order:

(1) Fees due to the register;

(2) Costs and expenses of administration;

(3) Funeral expenses as provided in § 8-106 of this subtitle;

(4) Compensation of personal representatives as provided in § 7-601 of this article, for legal services as provided in § 7-602 of this article, and commissions of licensed real estate brokers;

(5) Family allowance as provided in § 3-201 of this article;

(6) Taxes due by the decedent;

(7) Reasonable medical, hospital, and nursing expenses of the last illness of the decedent;

(8) Rent payable by the decedent for not more than three months in arrears;

(9) Wages, salaries, or commission for services performed for the decedent within three months prior to death of the decedent;

(10) Assistance paid under the Public Assistance to Adults Program, as provided in § 5-407(d) of the Human Services Article; and

(11) All other claims.

Therefore, as you go down the list and pay in the order specified, should the money run out, then the lower-preference claims for payment are not paid. This is what is known as an insolvent estate. The PR's duty is to prepare a proposed accounting and distribution of the estate assets showing amounts and to whom paid and for what category, in the order set forth above, and notify all those with lawful claims for whom estate funds are insufficient that their claims will not be paid.

Justia Ask a Lawyer is a forum for consumers to get answers to basic legal questions. Any information sent through Justia Ask a Lawyer is not secure and is done so on a non-confidential basis only.

The use of this website to ask questions or receive answers does not create an attorney–client relationship between you and Justia, or between you and any attorney who receives your information or responds to your questions, nor is it intended to create such a relationship. Additionally, no responses on this forum constitute legal advice, which must be tailored to the specific circumstances of each case. You should not act upon information provided in Justia Ask a Lawyer without seeking professional counsel from an attorney admitted or authorized to practice in your jurisdiction. Justia assumes no responsibility to any person who relies on information contained on or received through this site and disclaims all liability in respect to such information.

Justia cannot guarantee that the information on this website (including any legal information provided by an attorney through this service) is accurate, complete, or up-to-date. While we intend to make every attempt to keep the information on this site current, the owners of and contributors to this site make no claims, promises or guarantees about the accuracy, completeness or adequacy of the information contained in or linked to from this site.