North Carolina Probate Process

Information Gathering

The first step in probate is gathering all the necessary information about the deceased person’s estate. This includes:

• Locating the will, if one exists
• Identifying heirs and beneficiaries
• Listing all known assets and investments
• Compiling debts and liabilities

Usually, the personal representative opens a bank account for the estate where all the cash goes. These amounts are used to pay the estate expenses and obligations. If an asset needs to be sold to fulfill these obligations, prior approval from the court is required for the action to be legally valid.

Legal Authority

To oversee the estate, someone has to be given the legal authority to handle the probate and estate administration process. Usually, this role is filled by the executor named in the will, or if there’s no will, an administrator is appointed by the court.

Both the executor and the administrator are required to take an oath and receive either Letters Testamentary for a will or Letters of Administration for cases of intestacy. These documents grant them the legal authority to manage the estate on behalf of the decedent.

Fiduciary Responsibility

Once appointed, the executor or administrator has a fiduciary duty to act in the best interests of the estate and its beneficiaries. This means you must properly and prudently manage the estate administration as per the will. This involves notifying the relevant parties of your legal role, including the following: 

• All beneficiaries of the estate
• Known creditors 
• Decedent’s employer
• Social security administration
• Veteran Affairs 
• Internal revenue service
• Financial entities with accounts of the decedent

Failure to notify the relevant parties of your role can result in legal penalties. The best way to avoid issues is to work with a probate attorney from the beginning of the case.

Inventory & Valuation

The executor or administrator must compile a comprehensive inventory of the estate’s assets and submit it to the clerk of superior court within 90 days of appointment. This includes:

• Real estate
• Bank accounts
• Personal property
• Business interests

In many cases, a professional appraisal may be required to determine the fair market value of certain assets, such as real estate. However, note that some assets are not included in the probate process in North Carolina. An attorney can determine which assets should and should not be included in probate.

Creditors & Taxes

As an executor or administrator, you have a duty to pay any outstanding debts and taxes. This involves identifying creditors and publishing a public notice in a local newspaper to alert unknown creditors. You are also responsible for reviewing creditors' claims to determine their validity.

Distributions

After debts, taxes, and administrative expenses are paid, the remaining assets can be distributed to heirs or beneficiaries according to the will. If no will exists, North Carolina’s intestate succession laws dictate the distribution. 

When making distributions, you should ask the beneficiaries to sign a Receipt and Release acknowledging the distribution and releasing you from liability. With an engaged law firm, estate planning lawyers are familiar with the North Carolina Probate process and can help ensure you are limiting your liability.

Closing the Estate

The final step in probate involves petitioning the court to certify that you have completed your duties as executor or administrator and that you seek discharge from the role. At this stage, all assets in the estate have been distributed to the beneficiaries or to their trusts. The accounting filed with the court must accompany evidence of all transactions. 

Finally, it is important to assess any ongoing estate planning concerns or potential opportunities. For instance, it may be advisable for a surviving spouse to revise estate planning documents. Additionally, beneficiaries may need to establish individual estate plans now that they have received their share of inheritance through a court-supervised process.