In North Carolina, as in other states, dying without a will is known as dying intestate. It means your assets and liabilities are handled according to the state's laws of intestate succession. This is a complex set of rules, enforced by the probate court, that determines who the heirs of your estate are and the portion of the estate to which they are entitled.
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When handling intestacy, the North Carolina probate court will appoint an estate administrator to inventory all assets, pay debts and taxes, handle funeral expenses, and distribute the remaining property to the heirs of an estate. The court will deduct costs for administration before any property is distributed. These costs include clerk's fees and the fee paid to the court-appointed administrator.
The North Carolina Intestate Succession Act specifies the portion of real property assigned to the spouse, descendants -- natural or adopted children and grandchildren -- parents, and relatives of the deceased, known as the decedent. If a spouse and one child survive the decedent, the state assigns one-half interest in real property to the surviving spouse; if there are two or more children, or one child and any grandchildren, the spouse inherits one-third of the property. If there are no children or grandchildren, but at least one parent, the spouse is entitled to a one-half interest. The spouse inherits the entire estate if there are no children, grandchildren, or parents. If a spouse or descendants do not survive a decedent, the entire net estate passes to the decedent’s parents. If a spouse, descendants, or parents do not survive a decedent, the entire net estate passes to the decedent’s siblings or descendants of any deceased siblings. North Carolina law applies to real property within the state; real property located elsewhere is subject to the intestate laws of that state or country.
For personal property, such as cash, investments, boats, antiques, jewelry and other personal possessions, North Carolina first designates property, up to a total of $30,000, to go solely to the spouse, whether or not there are children, grandchildren or parents. After the initial $30,000, the law awards personal property to the spouse and other heirs proportionally as with real property. North Carolina intestate law applies to all personal property, no matter where it is located.
Certain assets are exempt from the intestate laws of North Carolina and are distributed according to contractual terms. For example, life insurance policies with designated beneficiaries pay the death benefits to the beneficiaries directly and are not covered by the intestate laws. This is also true for any payable-on-death (POD) or transferable-on-death (TOD) accounts that go to the named individual.
If the court finds that no individual has a legal claim to the estate, the property undergoes "escheat," meaning it is turned over to the state. North Carolina General Statute 116B-7 provides that the interest earnings from the state escheat fund go to student-aid programs in North Carolina.
North Carolina law also allows a surviving spouse to apply for a one-year support allowance for up to $20,000, or $30,000 if the spouse is the sole heir. The year is counted from the date of death. Any children under 18 are also entitled to a year's allowance of $2,000.
References & Resources
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