Updated August 3, 2026. Quick answer: when an estate cannot pay everyone, claims are paid in a statutory order of classes, not pro rata and not first-come. Federal claims come first under federal law; below that, the ordering is state law and it differs. Paying out of order is what makes an executor personally liable.
The federal layer sits above everything
(a) A claim of the United States Government shall be paid first when—(A) a person indebted to the Government is insolvent and—(i) the debtor without enough property to pay all debts makes a voluntary assignment of property; (ii) property of the debtor, if absent, is attached; or (iii) an act of bankruptcy is committed; or (B) the estate of a deceased debtor, in the custody of the executor or…
— 31 U.S.C. §3713(a), (b)
That applies in every state. The personal-liability consequence is the reason this page exists.
Below it, the state classes — Florida as a worked example
States express the order as numbered classes, and each class is paid in full before the next receives anything. Florida’s is set out at §733.707:
| Class | What it covers |
|---|---|
| 1 | Costs and expenses of administration, and the representative’s and attorney’s compensation |
| 2 | Funeral, interment and grave marker expenses — capped in the aggregate at $6,000 by the statute |
| 3 | Debts and taxes with federal priority; Medicaid and TANF claims; unpaid court costs and fines |
| 4 | Reasonable medical and hospital expenses of the last 60 days of the last illness |
| 5 | Family allowance |
| 6 | Arrearages from court-ordered child support |
| 7 | Debts from continuing the decedent’s business |
| 8 | All other claims, including judgments |
Reasonable funeral, interment, and grave marker expenses, whether paid by a guardian, the personal representative, or any other person, not to exceed the aggregate of $6,000.
— Fla. Stat. §733.707
Three things in that ordering surprise people. Administration costs rank above the funeral. The funeral is capped — anything above the statutory cap drops to the bottom class. And medical expenses only get their own class for the last 60 days; earlier medical debt falls to class 8 with everything else.
This is Florida, and yours will differ
The pattern is common — administration first, then funeral, then priority debts and taxes, then last-illness medical, with general creditors last. The specifics are not. The number of classes, the funeral cap, the medical window and where family allowance sits all vary by state.
We are publishing one state’s order as a worked example, not a national rule. Read your own state’s probate code, or have someone read it for you, before paying anything from an estate that cannot pay everyone.
What to do
- Establish insolvency first. If assets may not cover debts, the ordering rules govern and the personal-liability rule is live.
- Let the claim period run before distributing — the window is state law and it exists so you can see the whole picture.
- Pay class by class, in full, in order. Not proportionally across classes, and not by who asked first.
- Get a lawyer. An insolvent estate is the case where administering it yourself puts your own money at risk.
Related: the personal-liability rule · the creditor claim period.
General information drawn from federal statute, IRS publications and state probate codes, not legal or tax advice. Probate is STATE law and the order in which claims are paid differs between states; the federal priority rule described here applies everywhere, but the state ordering below it does not. An executor who pays the wrong claim first can become personally liable, which is why this wing exists. We sell nothing and refer you nowhere for a fee.
Before you conclude the estate cannot pay. Unclaimed wages, a forgotten pension, a matured savings bond or a VA insurance fund are all searchable for free and all belong to the estate: unclaimed property after a death.