Disclaimer

This is general information, not legal advice. I am not a lawyer. For decisions about a specific situation, consult a Tennessee probate or estate attorney.

Hypothetical Facts (for illustration)

Sarah owned a house and died without a will. A court-appointed personal representative sold the house to pay estate debts. After paying the mortgage, funeral costs, taxes, and sale expenses, $30,000 remained as leftover sale proceeds. No will names an heir, and Sarah’s family situation is unclear at first.

Detailed Answer

1. Who takes control of the money right after the sale?

When someone dies, their estate becomes a legal entity. A probate court usually appoints a personal representative (also called an administrator for intestate estates). The personal representative is the person with legal authority to collect assets (including sale proceeds), pay debts, and distribute what remains to heirs under Tennessee intestate law. See Tennessee probate and estate administration rules: Tenn. Code Ann. Title 30.

2. First priority: pay estate debts, taxes, and costs

The personal representative must use estate assets, including sale proceeds, to pay valid creditor claims, funeral expenses, court costs, estate administration fees, and taxes before any distribution to heirs. Only the balance after these lawful charges is distributable to heirs. (See probate administration rules: Tenn. Code Ann. Title 30.)

3. Who inherits the leftover proceeds when there is no will?

After debts and costs, the remaining funds pass through intestate succession. Tennessee law governs which family members inherit and in what shares. Typical rules (summary):

• If there is a surviving spouse and no surviving descendants (children, grandchildren), the spouse usually inherits everything.
• If there is a spouse and descendants all of whom are also descendants of the spouse, the spouse may inherit all or the large majority depending on the exact family facts.
• If there is a spouse and descendants not all of whom are descendants of the spouse (for example, children from a prior relationship), the estate may be split between spouse and children according to statutory formulas.
• If there is no spouse or descendants, other relatives (parents, siblings, nieces/nephews, more remote kin) inherit according to priority rules.

For the exact distribution rules, see Tennessee’s intestate succession statutes: Tenn. Code Ann. Title 31 (Wills & Intestate Succession). Consider getting legal help to apply those rules to your facts.

4. What if no one who is entitled can be located?

If the personal representative cannot locate heirs, or heirs do not claim the funds, the estate remains in the court’s control. If funds cannot be distributed and the estate administration closes with leftover unclaimed property, Tennessee’s unclaimed property rules may apply. Unclaimed funds can eventually transfer to the Tennessee Department of Treasury as unclaimed property. Heirs can later claim those funds through the Treasury’s unclaimed property process. See Tennessee Unclaimed Property: treasury.tn.gov/Unclaimed-Property.

5. Special situations: tax-sale or foreclosure surplus

If the leftover proceeds come from a county tax sale or sheriff’s foreclosure sale (for example, the county sold real property to collect unpaid taxes or a mortgage), a separate statutory procedure typically governs surplus distributions. For tax-sale surplus or foreclosure surplus, claim windows and priorities apply; if no claimant appears, counties or state rules control disposition. See Tennessee tax and real property statutes (Title 67 for taxation): Tenn. Code Ann. Title 67.

6. Practical steps to locate and secure leftover proceeds

Follow these steps as a likely heir or as someone involved in the estate:

1. Confirm probate: Check court records where the decedent lived to see whether an estate case is open and who the personal representative is.
2. Request accounting: Ask the personal representative for an accounting that shows sale proceeds, creditor payments, and the distributable balance.
3. Prove your claim: If you believe you are an heir, gather documentation (birth certificates, marriage certificates, family records) to prove your relationship and submit a claim to the personal representative or file a petition in probate court.
4. Use the Unclaimed Property site: If you cannot find a probate or personal representative, check the Tennessee Treasury unclaimed property database.
5. Get legal help if necessary: Disputes about heirship, creditor claims, or distributions often require a probate attorney to resolve in court.

7. Timing: how long before funds move to the state?

Timelines vary. Probate administration (notice to creditors, claim periods, time to locate heirs) can take months to years depending on complexity. If money becomes truly unclaimed, state unclaimed property rules and retention timelines determine when the Treasury takes custody. For immediate questions about deadlines in a specific estate, consult an attorney or the probate court handling the estate.

8. How to claim leftover proceeds if you are an heir

If you know of a decedent’s estate and think you are entitled to proceeds:

• Contact the probate court where the decedent lived to learn whether an administration exists and how to file a claim.
• If an estate is already closed and you later find leftover funds in the unclaimed property database, follow Tennessee Treasury’s claim process and provide documents establishing your identity and relationship.

9. When to consult an attorney

Get legal advice if:

• There is a dispute about who the heirs are.
• Creditors or tax authorities claim most or all proceeds.
• You cannot locate the personal representative or the probate records.
• You face time-sensitive deadlines (for example, to file claims in a probate or tax-sale context).

Helpful Hints

• Start at the probate court in the county where the decedent lived — court staff can often confirm whether an estate is open and who the administrator is.
• Keep documentation handy: death certificate, your birth certificate, marriage license, and any documents showing relationship to the decedent.
• Ask for a written accounting from the personal representative showing sale proceeds and deductions; this helps you verify the distributable amount.
• Search Tennessee’s unclaimed property database before assuming funds are lost: treasury.tn.gov/Unclaimed-Property.
• If the sale was a tax or foreclosure sale, act fast — special statutes and local procedures often control surplus claims.
• If possible, consult a probate attorney early — small estates can often be resolved quickly, but contested estates may require court intervention.
• Remember that a personal representative has fiduciary duties: they must act in the estate’s and heirs’ best interests and keep records of all transactions.