Utah Debt Payment Priority

When a Utah estate cannot pay everything it owes, Utah Code 75-3-805(1) decides who gets paid and who does not. The order is reasonable funeral expenses, costs and expenses of administration, debts and taxes with preference under federal law, last illness medical and hospital expenses, debts and taxes with preference under other Utah laws, and all other claims. Funeral expenses come first, ahead of administration costs.

That top pair is where most Utah content goes wrong. Utah is a Uniform Probate Code state, and the model act pays administration first and funeral second. Neighboring Arizona still enacts the model order verbatim at A.R.S. 14-3805(A), so a Utah page assembled from another state's template reverses Utah's two highest classes. Section 75-3-805 carries an effective date of 5/3/2023 and was last amended by Chapter 330 of the 2023 General Session.

Every Utah estate is heard in the district court of the county where the decedent lived, in all 29 counties, so there is no separate probate court to find first. Read this page beside the Utah creditor claims guide, which owns the notice deadlines and the bar, and the Utah executor duties guide, which puts payment in sequence with the rest of the job. This is general information about Utah law rather than advice about one estate. An insolvent estate is the case where a licensed Utah attorney earns the fee, so bring one in before you release money.

The Ladder Only Switches On When the Money Runs Out

Read the opening words of the section: "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." Where the estate covers everything, the classes create no tension because every allowed claim is paid anyway. The classes decide outcomes in two situations, and both are common.

The first is a genuinely insolvent estate, where the claims exceed what is there. Someone will go unpaid and the statute picks who.

The second is an estate that looked solvent and stopped being solvent. A hospital bill lands in month ten, or a tax assessment arrives after the heirs have been paid. Section 75-3-807(2) is what turns that into a personal problem for the personal representative rather than a disappointment for the creditor.

Section 75-3-805(2) sets two rules inside the ladder. No preference is given to any claim over another claim of the same class, so a class that cannot be paid in full is paid pro rata across everyone in it. And a claim that is due and payable gets no preference over claims that are not yet due. Paying the invoice that is shouting rather than the invoice that ranks is the error the section exists to prevent.

Three Allowances Come Off the Top Before Class One

The six classes are not the first call on a Utah estate. Section 75-3-807(1) directs the personal representative to pay allowed claims in the order of priority "after making provision for homestead, family, and support allowances." Utah Code Title 75 Chapter 2 Part 4 sets those three, and each carries its own priority language.

• Homestead allowance, 75-2-402. The surviving spouse takes it, or if there is no surviving spouse each minor child and each dependent child takes an equal share. The statute says the homestead allowance "is exempt from and has priority over all claims of the estate."
• Family allowance, 75-2-404. A reasonable allowance in money for the maintenance of the surviving spouse and the minor and dependent children during administration. It "is exempt from and has priority over all claims except the homestead allowance." Where the estate is inadequate to discharge allowed claims, the family allowance may not continue longer than one year.
• Exempt property, 75-2-403. Household furniture, automobiles, furnishings, appliances and personal effects, taken over and above any security interest in them. Rights to exempt property, and to assets needed to make up a deficiency of exempt property, have priority over all claims against the estate. The make-up assets abate as far as needed to permit earlier payment of the homestead allowance and the family allowance.

So the internal order among the three is homestead first, family allowance second, and exempt property make-up assets last. Section 75-2-405(1) adds a limit that matters when the estate is short: if the estate is otherwise sufficient, property covered by a specific devise may not be used to satisfy homestead allowance or exempt property rights.

The Allowance Figures Move With the Year of Death

The dollar amounts printed in those sections are the 2010 amounts. Utah Code 75-1-110 indexes the figures in 75-2-102, 75-2-202(2), 75-2-402, 75-2-403 and 75-2-405 to the CPI-U annual average against a 2009 reference base, using the index for the calendar year before the year of the decedent's death, rounded down to a multiple of $100 for an increase. Section 75-1-110(3) makes the Administrative Office of the Courts publish a cumulative table before February 1 each year. The table is live under the title "Estate Consumer Price Index."

Those are the amounts a 2026 estate loses before class one. Two of them are easy to confuse, so read the year label rather than the number: the 2026 exempt-property figure and the 2010 homestead figure are both $22,500. The monthly cap is the lump sum divided by 12, which 75-1-110(2) states outright. The Utah family allowance guide carries every year-of-death row and the rules for setting the amount without a court order. The Utah exempt property allowance guide covers the 75-2-403 figure on its own, including the make-up right that abates behind the other two.

Where a Medicaid Claim Sits

Class four names it: last illness medical and hospital expenses "including compensation of persons attending the decedent, and medical assistance if Section 26B-3-1013 applies." Section 26B-3-1013(2)(a) makes the recoverable medical assistance a lien against the deceased recipient's recovery estate, and 26B-3-1013(2)(b) says that lien "holds the same priority as reasonable and necessary medical expenses of the last illness as provided in Section 75-3-805."

Utah then answers the presentation question in the opposite direction. Section 75-3-104(4)(a) says that for purposes of the probate chapter, a lien or right to recover described in Section 26B-3-1013 "is not a claim," and 75-3-104(4)(b) adds that nothing in the chapter limits the department's recovery right. Section 75-3-803(4)(d) keeps medical assistance recovery outside the nonclaim bar as well. Priority and presentation are separate questions, and Utah answers them separately: the recovery ranks in class four for payment while never entering the claims process that bars other creditors.

Two more Utah rules follow from that. Recovery only reaches a recipient who was 55 or older, and 26B-3-1013(1)(b) blocks it while the deceased recipient's spouse is living or where a surviving child is under 21, blind or disabled. And under 75-3-104.5, the court itself notifies the Office of State Debt Collection when the decedent was at least 18 and the Office of Recovery Services when the decedent was at least 55, within 30 days after the probate application or petition is filed. Nobody in the family has to write to the state. Opening the case does it.

What the state can reach, and the exemptions and hardship waiver that limit it, sit on the Utah Medicaid estate recovery page. This page answers only where that lien ranks once it arrives.

Secured Claims Are Settled Outside the Ladder

A creditor holding collateral is not standing in line with the credit card companies. Section 75-3-803(4)(a) keeps any proceeding to enforce a mortgage, pledge or other lien on estate property outside the claim bar, and 75-3-812(1) bars execution and levy against estate property under a judgment against the decedent or the personal representative while excepting lien enforcement in an appropriate proceeding.

Section 75-3-809 then does the arithmetic on what is left over. If the creditor exhausts the security, payment runs on the allowed claim less the fair value of the security. If the creditor has no right to exhaust it or has not done so, payment runs on the allowed claim less the value of the security converted into money under the terms of the security agreement, or fixed by the creditor and the personal representative through agreement, arbitration, compromise or litigation. Only that shortfall enters the six classes, and it lands in class six unless something else moves it.

The practical version: the house with a mortgage on it is not an asset available to general creditors, and whoever inherits it inherits the loan.

Claims That Are Not Yet Due, Contingent or Unliquidated

Section 75-3-810 handles the claim nobody can price yet. If the claim becomes due or certain before distribution and has been allowed or established, it is paid in the same way as a present and absolute claim of the same class. Otherwise the personal representative, or the court on a petition, may pay the claimant the present or agreed value of the claim with the claimant's consent, taking the uncertainty into account, or arrange for future payment by creating a trust, giving a mortgage, or obtaining a bond or security from a distributee.

Section 75-3-806(4) adds a date that surprises people. Allowed claims bear interest at the legal rate for the period commencing six months after the date of death, unless the underlying contract provides for interest, in which case the contract rate applies. The interest clock starts from the death rather than from the day the claim arrived, so a slow insolvent administration grows the very claims it cannot pay.

Timing, and the Liability That Attaches to Paying Early

Section 75-3-807(1) sets the moment. On the expiration of the earliest of the time limits in Section 75-3-803, the personal representative pays the allowed claims in the order of priority, after making provision for the allowances, for claims already presented but not yet allowed or under appeal, for unbarred claims that may still be presented, and for costs and expenses of administration. A claimant whose claim was allowed but not paid can petition the court, or move in a supervised administration, for an order directing payment out of available funds.

Section 75-3-807(2) is the trap. The personal representative may pay any just unbarred claim at any time, with or without formal presentation, and is then personally liable to any other allowed claimant injured by that payment in two cases:

1. the payment went out before the time limit in Subsection (1) expired and the personal representative did not require the payee to give adequate security for the refund of whatever is needed to pay other claimants, or
2. the payment was made, through the negligence or willful fault of the personal representative, in a way that deprived the injured claimant of priority.

Read those two together with 75-3-805(2). A class-six credit card paid in month three because the collector called is exactly the shape of a claim under Subsection (2)(b) if a class-four hospital bill later goes unpaid. The two things that determine the exposure are the classification of every claim on the table and whether the earliest 75-3-803 deadline has run, and on a short estate both are questions to put to a licensed Utah attorney before anything is paid.

Section 75-3-806(1) sits alongside this. If the personal representative fails to mail a claimant notice of action on a claim within 60 days after the time for original presentation expires, that failure has the effect of a notice of allowance. Silence allows the claim, which means an insolvent estate can acquire an allowed claim by inattention.

A Federal Claim Carries Its Own Priority Statute

Class three, debts and taxes with preference under federal law, points outside the Utah code. Under 31 U.S.C. 3713(a)(1)(B), a claim of the United States Government "shall be paid first" when the estate of a deceased debtor in the custody of the executor or administrator is not enough to pay all debts of the debtor. Section 3713(b) then makes a representative who pays any part of another debt before paying a Government claim liable to the extent of that payment for the unpaid Government claim.

That is a second personal-liability rule, running on federal terms, and it applies to the same person 75-3-807(2) already binds. Where an estate that cannot pay everything owes federal taxes or another federal debt, the interaction between Section 3713 and the Utah ladder is a question to put to a Utah attorney before any money moves.

When the Estate Is Small Enough to Close Without Notice

Utah gives a short exit for the estate that the allowances and the top of the ladder will consume anyway. Section 75-3-1203 applies if the inventory and appraisal show that the value of the entire estate, less liens and encumbrances, does not exceed the total of the homestead allowance, exempt property, the family allowance, costs and expenses of administration, reasonable funeral expenses, and reasonable and necessary medical and hospital expenses of the last illness. The personal representative may then, "without giving notice to creditors," immediately disburse and distribute the estate to the persons entitled and file a closing statement under 75-3-1204.

Look at what that list is. It is the three allowances plus classes one, two and four of 75-3-805. Utah's summary close is drawn from the top of the ladder: where nothing would reach classes three, five and six, the statute lets you skip the notice that only those classes need.

Section 75-3-1203 sets no dollar figure. For a 2026 death the fixed part is $33,700 plus $22,500 plus $40,500, which is $96,700, and the rest depends on the actual funeral, administration and last-illness bills. That has to be worked out estate by estate rather than looked up, which is also why the Utah small estate guide treats it as a separate route from the $100,000 affidavit in 75-3-1201.

A Worked Example

Take a decedent who died in 2026 leaving a surviving spouse, $50,000 in a bank account, no real property and no household goods worth counting. The claims are a $9,000 funeral bill, $6,000 of administration costs, a $40,000 hospital bill from the last illness and $25,000 of credit card balances.

The allowances go first. The homestead allowance of $33,700 leaves $16,300. The family allowance follows, and the personal representative may set it in a lump sum up to $40,500 or in installments up to $3,375 a month without a court order, running no longer than one year here because the estate cannot discharge the allowed claims. A reasonable family allowance can absorb what is left. Exempt property has priority over claims too, and because there are no household goods to take, the spouse's right runs against other assets to make up the deficiency, which then abates behind the homestead and family allowances.

Nothing reaches the funeral home. Nothing reaches the hospital. Nothing reaches the card issuers. And because the estate is worth less than the total of the allowances plus funeral, administration and last-illness expenses, 75-3-1203 lets the personal representative distribute and close without publishing notice at all.

Change one fact and the answer changes. Give the same estate a $400,000 house owned outright and the allowances take $96,700 at the very most, which leaves enough to pay the funeral home, the administration costs, the hospital and the card issuers in full, so 75-3-805 never has to rank anything. Put a $390,000 mortgage on that same house and the lender is dealt with under 75-3-809 rather than inside the six classes, the equity left for everyone else is about $10,000, and the allowances take the estate back down to nothing.

Abatement Is a Different Ladder

Creditors and beneficiaries run on separate rules, and mixing them is a common error. Section 75-3-805 ranks claims. Section 75-3-902 ranks the shares of distributees once the claims are settled, and it abates in this order: property not disposed of by the will, then residuary devises, then general devises, then specific devises. Abatement within each classification is proportional. Where the will expresses its own order of abatement, or where the order in Subsection (1) would defeat the testamentary plan, 75-3-902(3) lets the shares abate as needed to give effect to the testator's intention.

So an insolvent estate never reaches Section 75-3-902 at all, and a solvent estate with more devises than assets reaches it without ever consulting 75-3-805.

What Survives Distribution

Closing the estate does not end the exposure, and an estate that paid in the wrong order carries the exposure forward.

• Section 75-3-1004 lets an undischarged claim that is not barred be pursued against the distributees after the assets go out. No distributee is liable for amounts received as exempt property, homestead or family allowances, or for more than the value of that distribution at the time it was made. Between distributees, each bears the cost as if the claim had been paid during administration, and a distributee who fails to tell the others about a demand in time for them to join the proceeding loses the right of contribution.
• Section 75-3-1005 bars creditors and successors from suing the personal representative for breach of fiduciary duty unless the proceeding starts within six months after the closing statement is filed. Fraud, misrepresentation and inadequate disclosure about the settlement of the estate stay outside that bar.
• Section 75-3-104(2) points at both: after distribution, a creditor whose claim was not barred may recover from the distributees under 75-3-1004 or from a former personal representative individually liable under 75-3-1005.

When to Call a Utah Attorney

Bring in a licensed Utah attorney when:

• the claims on the table exceed the assets, so 75-3-805 classification decides who goes unpaid
• a federal tax or other federal debt is in the mix, because 31 U.S.C. 3713 adds its own priority and its own personal liability
• the decedent received Medicaid at 55 or older, since 26B-3-1013 recovery ranks in class four while sitting outside the claims process
• a class boundary is arguable, such as whether a bill belongs to the last illness or to ordinary care years earlier
• a secured creditor and the estate disagree on the value of the collateral under 75-3-809
• a family member is pressing for a family allowance the remaining creditors would fund
• you have already paid a claim and now suspect a higher class will go short

Frequently Asked Questions

What order does Utah pay estate debts in?

Utah Code 75-3-805(1) sets six classes for an estate whose assets will not pay every claim in full: reasonable funeral expenses, costs and expenses of administration, debts and taxes with preference under federal law, reasonable and necessary medical and hospital expenses of the last illness including compensation of persons attending the decedent and medical assistance where Section 26B-3-1013 applies, debts and taxes with preference under other Utah laws, and all other claims. Under 75-3-805(2) nothing outranks anything else inside a class, and a claim that is due gets no preference over a claim that is not yet due.

Does Utah really pay funeral expenses before administration costs?

Yes. Utah Code 75-3-805(1)(a) is reasonable funeral expenses and 75-3-805(1)(b) is costs and expenses of administration. The model Uniform Probate Code reverses those two, and neighboring Arizona still enacts the model order verbatim at A.R.S. 14-3805(A), so a Utah page built from another state's template usually has the top of the ladder backwards. The section carries an effective date of 5/3/2023 and was amended by Chapter 330 of the 2023 General Session.

Do the family allowances get paid before creditors in Utah?

Yes. Utah Code 75-3-807(1) tells the personal representative to pay allowed claims after making provision for homestead, family and support allowances. Section 75-2-402 says the homestead allowance is exempt from and has priority over all claims of the estate, 75-2-404(1) gives the family allowance priority over all claims except the homestead allowance, and 75-2-403 gives exempt property priority over all claims against the estate. Those three amounts come off the top before any of the six classes is reached.

How much are the Utah allowances for a 2026 death?

For a decedent who died in 2026 the homestead allowance is $33,700, exempt property is $22,500, and the family allowance lump sum the personal representative may set without a court order is $40,500, or $3,375 a month. The statutes print the 2010 amounts of $22,500, $15,000, $27,000 and $2,250 because Utah Code 75-1-110 indexes all of them to the Consumer Price Index by the decedent's year of death. The Administrative Office of the Courts publishes the cumulative table each year before February 1.

Where does a Utah Medicaid claim rank?

Utah Code 26B-3-1013(2)(b) says the Department of Health and Human Services lien holds the same priority as reasonable and necessary medical expenses of the last illness under Section 75-3-805, which is the fourth class. Presentation works differently from payment: 75-3-104(4)(a) says that lien or right to recover is not a claim for purposes of the probate chapter at all, and 75-3-803(4)(d) keeps medical assistance recovery outside the nonclaim bar.

Can a Utah personal representative be held personally liable for paying in the wrong order?

Yes. Utah Code 75-3-807(2) lets the personal representative pay any just unbarred claim at any time, then makes the personal representative personally liable to another allowed claimant injured by that payment in two situations: the payment went out before the claim deadline in Subsection (1) without requiring the payee to give adequate security for a refund, or the personal representative's negligence or willful fault deprived the injured claimant of priority.

What happens to a secured creditor when a Utah estate is insolvent?

The security is dealt with first and only the shortfall enters the ladder. Under Utah Code 75-3-809 a creditor who exhausts the security is paid on the allowed claim less the fair value of that security, and a creditor who has no right to exhaust it, or has not done so, is paid on the allowed claim less the value of the security converted into money under the security agreement or fixed by agreement, arbitration, compromise or litigation. Section 75-3-803(4)(a) also keeps lien enforcement outside the claim bar, so the mortgage on the house does not disappear because the estate is short.

Sources:

• Title: Utah Code Section 75-3-805, Classification of claims. Publisher: Utah State Legislature. Publication Date: Effective 5/3/2023, Amended by Chapter 330, 2023 General Session, accessed 2026-08-28. URL: https://le.utah.gov/xcode/Title75/Chapter3/C75-3-S805_2023050320230503.html
• Title: Utah Code Section 75-3-807, Payment of claims. Publisher: Utah State Legislature. Publication Date: Amended by Chapter 179, 1992 General Session, accessed 2026-08-28. URL: https://le.utah.gov/xcode/Title75/Chapter3/C75-3-S807_1800010118000101.html
• Title: Utah Code Section 75-3-806, Allowance of claims. Publisher: Utah State Legislature. Publication Date: Amended by Chapter 179, 1992 General Session, accessed 2026-08-28. URL: https://le.utah.gov/xcode/Title75/Chapter3/C75-3-S806_1800010118000101.html
• Title: Utah Code Section 75-3-809, Secured claims. Publisher: Utah State Legislature. Publication Date: Amended by Chapter 30, 1992 General Session, accessed 2026-08-28. URL: https://le.utah.gov/xcode/Title75/Chapter3/C75-3-S809_1800010118000101.html
• Title: Utah Code Section 75-3-810, Claims not due and contingent or unliquidated claims. Publisher: Utah State Legislature. Publication Date: Enacted by Chapter 150, 1975 General Session, accessed 2026-08-28. URL: https://le.utah.gov/xcode/Title75/Chapter3/C75-3-S810_1800010118000101.html
• Title: Utah Code Section 75-3-812, Execution and levies prohibited. Publisher: Utah State Legislature. Publication Date: Effective 5/7/2025, Amended by Chapter 59, 2025 General Session, accessed 2026-08-28. URL: https://le.utah.gov/xcode/Title75/Chapter3/C75-3-S812_2025050720250507.html
• Title: Utah Code Section 75-3-803, Limitations on presentation of claims. Publisher: Utah State Legislature. Publication Date: Effective 5/7/2025, Amended by Chapter 59, 2025 General Session, accessed 2026-08-28. URL: https://le.utah.gov/xcode/Title75/Chapter3/C75-3-S803_2025050720250507.html
• Title: Utah Code Section 75-3-104, Claims against decedent, Necessity of administration, Exclusions. Publisher: Utah State Legislature. Publication Date: Effective 5/7/2025, Amended by Chapter 59, 2025 General Session, accessed 2026-08-28. URL: https://le.utah.gov/xcode/Title75/Chapter3/C75-3-S104_2025050720250507.html
• Title: Utah Code Section 75-3-902, Distribution, Order in which assets appropriated, Abatement. Publisher: Utah State Legislature. Publication Date: Amended by Chapter 306, 2007 General Session, accessed 2026-08-28. URL: https://le.utah.gov/xcode/Title75/Chapter3/C75-3-S902_1800010118000101.html
• Title: Utah Code Section 75-3-1004, Liability of distributees to claimants. Publisher: Utah State Legislature. Publication Date: Amended by Chapter 194, 1977 General Session, accessed 2026-08-28. URL: https://le.utah.gov/xcode/Title75/Chapter3/C75-3-S1004_1800010118000101.html
• Title: Utah Code Section 75-2-402, Homestead allowance. Publisher: Utah State Legislature. Publication Date: Amended by Chapter 93, 2010 General Session, accessed 2026-08-28. URL: https://le.utah.gov/xcode/Title75/Chapter2/C75-2-S402_1800010118000101.html
• Title: Utah Code Section 75-2-403, Exempt property. Publisher: Utah State Legislature. Publication Date: Amended by Chapter 93, 2010 General Session, accessed 2026-08-28. URL: https://le.utah.gov/xcode/Title75/Chapter2/C75-2-S403_1800010118000101.html
• Title: Utah Code Section 75-2-404, Family allowance. Publisher: Utah State Legislature. Publication Date: Repealed and Re-enacted by Chapter 39, 1998 General Session, accessed 2026-08-28. URL: https://le.utah.gov/xcode/Title75/Chapter2/C75-2-S404_1800010118000101.html
• Title: Utah Code Section 75-1-110, Cost of living adjustment of certain dollar amounts. Publisher: Utah State Legislature. Publication Date: Enacted by Chapter 93, 2010 General Session, accessed 2026-08-28. URL: https://le.utah.gov/xcode/Title75/Chapter1/C75-1-S110_1800010118000101.html
• Title: Estate Consumer Price Index. Publisher: Utah State Courts, Administrative Office of the Courts. Publication Date: Not listed, accessed 2026-08-28. URL: https://www.utcourts.gov/en/about/miscellaneous/legal-community/price.html
• Title: Utah Code Section 26B-3-1013, Estate and trust recovery. Publisher: Utah State Legislature. Publication Date: Effective 5/7/2025, Amended by Chapter 310, 2025 General Session, accessed 2026-08-28. URL: https://le.utah.gov/xcode/Title26B/Chapter3/C26B-3-S1013_2025050720250507.html
• Title: 31 U.S.C. 3713, Priority of Government claims. Publisher: Office of the Law Revision Counsel, United States House of Representatives. Publication Date: Pub. L. 97-258, Sept. 13, 1982, 96 Stat. 972, accessed 2026-08-28. URL: https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title31-section3713&num=0&edition=prelim
• Title: Arizona Revised Statutes 14-3805, Priority of claims. Publisher: Arizona State Legislature. Publication Date: Not listed, accessed 2026-08-28. URL: https://www.azleg.gov/ars/14/03805.htm

It is not legal advice.