One of the advantages of having a Last Will and Testament is that the testator (the person who makes the will) gets to decide who will inherit what, among other choices concerning his or her estate. Dying without a Will, on the other hand, is known as dying intestate. If this happens, North Carolina law sets forth a number of complicated rules as to who will inherit from the estate. These intestate laws govern the administration of the deceased individual’s estate and will determine the ultimate disposition of his or her assets and debts. The Estate Planning and Administration attorneys of Patrick, Harper & Dixon, LLP explain the process.
The court will first appoint an administrator to oversee the estate. This individual is akin to an executor and exercises similar duties. Without a Will, the testator cannot choose who will manage the estate.
The administrator is responsible for paying the estate’s debts, funeral and other final expenses, and court costs. After these are paid the remaining estate assets are distributed to heirs according to the following schedule set forth in North Carolina statutes (organized according to whether the deceased died with or without a spouse):
If only the spouse survives (no living parents and no children), the spouse inherits everything that could pass under a will.
If the spouse survives along with living parents of the deceased, but there are no children, the spouse inherits the first $100,000 of personal property, 50% of the remaining personal property, and 50% of all real estate. The parents inherit 50% of the remaining personal property and 50% of all real estate.
If the spouse survives along with one child, the spouse inherits the first $60,000 of personal property, 50% of the remaining personal property, and 50% of all real estate. The child inherits 50% of the remaining personal property and 50% of all real estate.
If the spouse survives along with two or more children, the spouse inherits the first $60,000 of personal property, one-third of the remaining personal property, and one-third of all real estate. The children will evenly inherit the remaining two-thirds of personal property and real estate.
No Surviving Spouse
If there is no surviving spouse, and no children, but there are living parents, the parents will equally divide the estate. And if only one parent survives, that parent inherits everything.
If there is no surviving spouse, but there are one or more children, the children will evenly divide everything. For any child that had already died, that child’s share passes to any lineal descendants.
If there is no surviving spouse, no children and no living parents, more distant relatives will inherit the estate. These include grandparents, siblings, cousins, and others. If there are no heirs, the estate passes to the State of North Carolina.
This is just an overview of the intestate laws, and your exact family arrangement may make the distribution even more complex. The most important takeaway, however, is that the State of North Carolina decides who inherits your assets if you fail to execute a valid Will prior to your death. Individuals you may not even know could claim some of your most precious assets. Worse, those who you’d prefer to inherit a particular piece of property may not, depending on where they fall in the above lines of succession.
The best way to avoid these problems, and have the final say in what happens to your assets after death, is to execute a comprehensive estate plan. It starts with a Last Will and Testament but will likely include other instruments such as trusts and powers of attorney. Give the team at Patrick, Harper & Dixon, LLP a call to get started on your personalized estate plan today.