What Happens When an Estate Is Insolvent in Tennessee?
Enter the estate's assets and the claims in each class of Tennessee's payment order to see which claims are paid in full, which are paid in part, and which go unpaid, along with when the executor is personally liable.
Frequently Asked Questions
An estate is insolvent when the claims against it exceed the assets available to pay them. Tennessee then pays the claims in 4 classes, in the order its statute sets, and the classes at the end of the order are the ones left unpaid when the money runs outT.C.A. § 30-2-317Verified Sep 23, 2026View source.
1. Costs of administration (incl. bond premiums, PR and counsel compensation)T.C.A. § 30-2-317(a)(1)Verified Sep 23, 2026View source. 2. Reasonable funeral expensesT.C.A. § 30-2-317(a)(2)Verified Sep 23, 2026View source. 3. Federal, state, and local taxes and assessments (incl. TennCare claims)T.C.A. § 30-2-317(a)(3)Verified Sep 23, 2026View source. 4. All other demands filed within 4 months of notice to creditorsT.C.A. § 30-2-317(a)(4)Verified Sep 23, 2026View source.
In proportion to their amounts: each claim in the class receives the same share of what it is owedT.C.A. § 30-2-317(b)Verified Sep 23, 2026View source.
A personal representative who pays a later class before an earlier class is paid in full is personally liableTenn. Code Ann. § 30-2-318(b)Verified Sep 23, 2026View source. Tennessee's statutes state no rule on the personal representative's personal liability for the decedent's debts or distributing property to heirs while claims are unpaid.
A person named in the will files a written declination with the court (Tenn. Code Ann. § 30-1-112(a)). A notary is not required. Renunciation of Executor for Tennessee
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