2025 Session Last amended: 2003 session

§ 524.3-805 — Classification of Claims

Plain-Language Summary

When an estate does not have enough money to pay all debts, this section sets the order in which claims must be paid. Administration costs are paid first, then funeral expenses, then federal debts and taxes, then medical bills from the last illness, then other medical expenses from the year before death, then state debts and taxes, and finally all other claims.

524.3-805 CLASSIFICATION OF CLAIMS.

(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) costs and expenses of administration;

(2) reasonable funeral expenses;

(3) debts and taxes with preference under federal law;

(4) reasonable and necessary medical, hospital, or nursing home expenses of the last illness of the decedent, including compensation of persons attending the decedent, a claim filed under section 256B.15 for recovery of expenditures for alternative care for nonmedical assistance recipients under section 256B.0913, and including a claim filed pursuant to section 256B.15;

(5) reasonable and necessary medical, hospital, and nursing home expenses for the care of the decedent during the year immediately preceding death;

(6) debts with preference under other laws of this state, and state taxes;

(7) all other claims.

(b) No preference shall be given in the payment of any claim over any other claim of the same class, and a claim due and payable shall not be entitled to a preference over claims not due, except that if claims for expenses of the last illness involve only claims filed under section 256B.15 for recovery of expenditures for alternative care for nonmedical assistance recipients under section 256B.0913, section 246.53 for costs of state hospital care and claims filed under section 256B.15, claims filed to recover expenditures for alternative care for nonmedical assistance recipients under section 256B.0913 shall have preference over claims filed under both sections 246.53 and other claims filed under section 256B.15, and claims filed under section 246.53 have preference over claims filed under section 256B.15 for recovery of amounts other than those for expenditures for alternative care for nonmedical assistance recipients under section 256B.0913.

History:

1975 c 347 s 58; 1982 c 621 s 2; 1982 c 641 art 1 s 19; 1983 c 180 s 19; 1986 c 444; 1987 c 325 s 2; 1Sp2003 c 14 art 2 s 52

History: History: 1975 c 347 s 58; 1982 c 621 s 2; 1982 c 641 art 1 s 19; 1983 c 180 s 19; 1986 c 444; 1987 c 325 s 2; 1Sp2003 c 14 art 2 s 52

Practical Notes

When this applies: When an estate does not have enough assets to pay all creditors in full. Who this affects: Creditors and personal representatives deciding who gets paid. Key points: The personal representative must pay claims in the order listed in this section. Within the same class, all claims are treated equally. Funeral expenses come before regular debts but after administration costs. Medical Assistance recovery claims fall under the medical expense categories.

Source: Minnesota Office of the Revisor of Statutes