If there are insufficient funds in the estate, what is the order of abatement for gifts?

In the context of estate administration, the order of abatement refers to the sequence in which different types of gifts are reduced when there are not enough funds in the estate to fully satisfy all bequests. The correct choice highlights the typical legal principle that the residuary estate is usually the first to absorb losses when estate assets are insufficient to cover all bequests.

Specific bequests—those that designate particular items or amounts of money to individual beneficiaries—are prioritized. They are considered the most concrete and identifiable types of bequests, as they relate directly to specified property. Consequently, these specific gifts are intended to be fulfilled first because they represent a direct promise to the beneficiary.

The residuary estate, on the other hand, encompasses whatever remains after all debts, expenses, and bequests have been settled. Since it is a broader category and is collected from the leftover assets, it serves as the last line of defense when the estate is short on funds. Therefore, the correct hierarchy of abatement recognizes this distinction, indicating that the residuary estate is accessed last, reflecting its secondary nature compared to specific bequests.

By understanding this hierarchy, one can grasp how the law seeks to honor the testator’s intent to fulfill specific gifts before resorting to