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Classes of Creditors Claims in a Florida Probate

Executor

One of the most important duties a personal representative has in administering someone’s estate is to ensure that creditors are paid based on their priority. If someone has filed a creditor claim on the estate, the personal representative has the duty to ensure all of these are paid. But, how do you know in what order to pay them? Fortunately, there is a clear order set forth in the Florida statutes on how creditors’ claims are to be handled.

Order of Claims in a Florida Probate

This is the order of claims that are to be paid in a probate per Florida Probate Code Section 733.707:

  • Class 1: Expenses for probate administration, compensation for the personal representative, and attorneys’ fees.
  • Class 2: Florida law allows for up to $6,000 in costs for funeral and burial expenses. In most cases, you will have had to pay this before probate actually starts, but this is compensation for that once Class 1 costs are covered.
  • Class 3: Class 3 costs include taxes and debts with a preference under federal law. In addition, claims related to unpaid court expenses and debts amassed through public assistance or Medicaid would be paid out under Class 3 costs.
  • Class 4: Any medical care that the decedent received in the 60 days prior to death will be paid out, provided they meet the standard of reasonable and necessary. If a family member tended to the decedent while alive, they would be paid out under Class 4 costs.
  • Class 5: Class 5 is a “family allowance” that includes money which is set aside to maintain the decedent’s surviving spouse and children. This amount can be paid for up to a year after the family member’s death.
  • Class 6: If there is past due child support, which is known as “arrears,” it would be paid out as a Class 6 costs, right after money is set aside for the family allowance in Class 5.
  • Class 7: If the deceased ran up any debt through his or her business, these would be paid next. It’s important to note that these would not be paid from the decedent’s personal assets. They would only be compensated with any assets owned or acquired by the decedent’s business.
  • Class 8: All other claims that don’t fall into Classes 1 through 7 would be paid out here.

How are Claims Paid

In most cases, the claims are covered by the decedent’s liquid assets, but there may be a need to involve other assets if the liquid assets are wiped out paying the line of creditors. In the event there are not enough assets to pay Class 1 through 7’s claims, the personal representative could potentially pull assets from a revocable living trust to satisfy the outstanding expenses that need to be paid.

Retaining a Florida Probate Attorney

If you have questions on creditors’ claims or need assistance with administering a probate, you need to speak with a knowledgeable West Palm Beach probate attorney who can help you through this emotionally difficult time. Paying the creditors’ claims is only a portion of what occurs during probate and dealing with the listed beneficiaries in the will can be trying. Contact the Law Offices of Larry E. Bray and let us help make the entire Florida probate process more streamlined and easier to get through.

Resource:

leg.state.fl.us/statutes/index.cfm?App_mode=Display_Statute&Search_String=&URL=0700-0799/0733/Sections/0733.707.html

https://www.braylawoffices.com/who-are-reasonably-ascertainable-creditors-in-a-florida-probate/

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