What Happens to Your Assets When You Pass Away Without an Estate Plan?
When someone passes away in North Carolina without an estate plan, the probate court will appoint an administrator to distribute that person’s estate. A person’s estate includes real property and personal property he or she owns at the time of his or her death. When a person does not have a will, the probate court will distribute certain property according to North Carolina’s intestacy laws. If the deceased individual has a surviving spouse and children, they will inherit first. Unfortunately, when someone passes away without an estate plan, the probate court may distribute that person’s property to people whom he or she might not have wished to receive said property.Who Will Receive Your Assets if You Pass Away Without an Estate Plan?
When a person dies with a will in place, the estate administrator will distribute his or her assets according to the terms of the will. When someone dies without a will in place, the estate administrator, supervised by the probate court, will distribute the assets according to North Carolina’s Intestate Succession Act, which sets forth which family members will receive assets.North Carolina’s Intestate Succession Act
North Carolina’s Intestate Succession Act governs what happened to a person’s property after they pass away without a will. The Office of the Clerk of Superior Court located in the county where a person dies is responsible for administering the distribution of his or her property. When someone dies with an estate plan in place, he or she will often have appointed an estate administrator in the will. When a person passes away without a valid will in place, the probate court will appoint someone to act as the estate administrator. The estate administrator is responsible for gathering the assets, handling funeral expenses, paying the estate’s taxes and debts, and distributing whatever assets remain in the estate to the beneficiaries. The North Carolina Intestate Succession Act sets forth who will receive the assets as follows:
- When the deceased individual passes away with no children and a surviving spouse, the spouse will receive all of the deceased person’s probate assets that he or she would normally inherit under a will.
- When the deceased leaves behind a spouse and one child, or a child’s descendants, the spouse will receive the first $60,000 of personal property and assets and split the remaining balance equally between the spouse and child, or child’s lineal descendant.
- When the deceased individual has two or more children or descendants of children, the spouse will receive the first $60,000 worth of personal property and one-third of the remaining balance of personal property. The court will divide the remaining personal property between the deceased person’s children.
- When the deceased individual does not have a spouse, children, or other lineal descendants, but dies with surviving parents, the entire estate will pass to the parents, divided equally. When only one parent has survived, that parent will receive the entire estate.
- When the deceased individual does not have a surviving spouse, surviving children or lineal descendants, or surviving parents, the probate court will divide the estate among brother and sisters and their lineal descendants.
- Others who may inherit through intestacy when the person dies without any living close family members include grandparents, aunts and uncles, and any other distant relatives “who otherwise would be entitled.”
As mentioned above, if you pass away without a will or trust in place, the state of North Carolina will determine how to distribute your property according to intestacy laws. Doing so could result in your property being given to a distant relative with whom you are not close. In some cases, an estate will be given to a distant family member you do not even know. In most cases, people would prefer to give their assets to a family member of their choice, a college or university, or even a meaningful charity, rather than allow the state to decide. When probate courts cannot find a qualifying relative, a deceased individual’s estate may default into escheat and be confiscated by the state of North Carolina. Creating an estate plan will prevent this from happening and allow you to control your hard-earned assets.Contact Our Charlotte, Mooresville, and Monroe Estate Lawyers Today
If you do not have an estate plan in place, the lawyers at Arnold & Smith, PLLC, can help. Contact our Charlotte, Mooresville, and Monroe estate planning lawyers as soon as possible to schedule your initial consultation.