Illinois Probate Act 755 ILCS 5/24-4: Distribution Before the Expiration of the Period When Claims are Barred

While the final result of estate administration is the distribution of estate assets to the decedent’s beneficiaries and heirs, another important goal of estate administration is the payment of estate debts and bills left by the decedent. The estate administrator is responsible for ensuring that all estate debts are paid. Typically, the administrator is barred from distributing estate assets until all creditors are paid. Failure to do so might result personal liability of the administrator for the debt owed to the unpaid creditors. If you have questions related to asset distribution and payment of claims, including the requirements of Illinois Probate Act, section 24-4- Distribution before the expiration of the period when claims are barred, contact a skilled Chicago estate administration attorney at the Law Offices of Stephen Bilkis & Associates.

Before the assets of a an estate can be distributed to beneficiaries and heirs, there are several other steps that the estate administrator must complete including taking an inventory of the estate assets and appraising them, safeguarding estate assets, and paying estate debt and settling claims against the estate.

The administrator has a duty to notify creditors of a decedent that the estate is going through the administration process. The administration accomplishes this by publishing a notice each week for three consecutive weeks, and by mailing a notice to known creditors. The notice must include the date by which claims must filed. The date must be at least 6 months from the date of the first publication or 3 months from the date of mailing or delivery of the notice. Any claim that is filed late will be barred.

Generally, as an experienced Chicago estate administration attorney will explain, the administrator must wait until the 6 month period passed before making distributions from the estate to beneficiaries and heirs in order to ensure that there are sufficient funds in the estate to pay all valid claims that are timely filed.

All creditors must be aid according to their priority rights. In Illinois, the priority is as follows:

• Funeral and burial expenses, expenses of administration, and statutory custodial claims. Funeral expenses include reasonable amounts paid for a burial space, crypt or niche, a marker on the burial space, and the care of the burial space, crypt or niche.
• The surviving spouse's or child's award under Illinois Probate Act, sections 15-1 and 15-2.
• Debts due the United States.
• Money due employees of the decedent for services rendered within 4 months prior to the decedent's death and expenses attending the last illness.
• Money and property received or held in trust by decedent which cannot be identified or traced.
• Debts owed to the state of Illinois and debts owed to any county, township, city, town, village or school district located within Illinois.
• All other claims.

While the general rule is that the administrator must for the 6 month period to pass before distributing assets, there are exceptions to this rules. Under Illinois Probate Act, section 24-4- Distribution before the expiration of the period when claims are barred, if it appears that the estate has sufficient assets to pay all claims against the estate, the Probate Court may allow the administrator to distribute assets early. However, as an experienced estate administration attorney in Chicago will explain, the court will require that the beneficiary who would receive the distribution post a bond double the value of the distribution to be paid in order to protect the administrator in case it turns out that the estate does not have sufficient funds to pay a claim.

1. Duty to account: Illinois Probate Act, 755 ILCS 5/24-1
2. Notice of accounting - effect: Illinois Probate Act, 755 ILCS 5/24-2
3. Order of distribution, abatement and contribution on settlement of estate: Illinois Probate Act, 755 ILCS 5/24-3

(a) If it appears that there are sufficient assets to pay all claims against the estate of a decedent, the court may order the representative to pay the distributive share to a distributee before the expiration of the period when claims are barred under Section 18-12 if the distributee gives bond payable to and for the indemnity of the representative in double the value of the distributive share to be paid, with surety to be approved by the court, conditioned to refund the due proportion of any claim entitled to be paid from the estate distributed together with the expenses of recovery, including reasonable attorneys' fees and additional expenses of administration.

(b) If at any time after payment of a distributive share it becomes necessary for all or any part of the distributive share to be refunded for the payment of any claim entitled to be paid from the estate distributed, upon petition of any interested person the court shall order the distributee to refund that portion of his distributive share which is necessary to pay the claim. If there is more than one distributee, the court shall apportion among the distributees the amount to be refunded according to the amount received by each of them, but specific and general legacies need not be refunded unless the residue is insufficient to satisfy the claims entitled to be paid from the estate distributed. If a distributee refuses to refund within 60 days after being ordered by the court to do so and upon demand, the refusal is deemed a breach of the bond and a civil action may be maintained by the representative against the distributee and the surety or either of them for the amount due together with the expenses of recovery, including reasonable attorneys' fees. The order of the court is evidence of the amount due.

If you are an interested party in an estate matter and you have questions about or objections to the timing of the distribution of assets or a claim against the estate, it is important that you discuss the process with an experienced estate administration attorney serving Chicago who understands the requirements related to estate administration, including the requirements of the Illinois Probate Act, section 24-4- Distribution before the expiration of the period when claims are barred . The attorneys at the Law Offices of Stephen Bilkis & Associates have years of experience successfully representing clients in matters related to estate administration, estate litigation, and other estate matters. Contact an attorney in our office at 855-454-5529 to schedule a free, no obligation consultation regarding your case. We serve individuals throughout Chicago.