Probate & Estate Administration
At Crosswhite, Crosswhite & Johnson, PLLC, our attorneys and paralegals provide excellent assistance to clients dealing with estate administration issues that range in complexity. Some of the areas we most often consult with clients include the North Carolina Probate process, simple and complex trust administration, property transfers, contested wills and caveats, testamentary special needs trust administration and intestate Estates.
General Timeline of Estate Administration
Months One – Three.
Secure the decedent’s property and get information about the decedent’s assets
The property should be secured until someone is authorized by the Clerk of Superior Court to handle the estate, such as the Executor or the Administrator of the estate. The Personal Representative will work to create an inventory of the deceased’s property in the beginning stages of administering an estate.
Get in touch with the Clerk of Superior Court in whichever county the decedent is a resident in.
The executor should give the will, if the decedent had one, to the Clerk of Superior Court. This process is known as probating a will. The Clerk will determine if the will is valid.
If they did not have a will, the surviving spouse or any other heir needs to contact the Clerk so that they may be appointed as administrator.
To apply to be the personal representative (executor/administrator) of the estate, you have to have a preliminary inventory of the decedent’s known assets and the value of each of those assets.
If there is a will, then “Letters of Testamentary” will be issued to the appointed Executor by the Clerk of Court. If there is no will, then “Letters of Administration,” will be issued to appoint an administrator for the estate.
Strategize and think through the alternatives for a full administration.
Whether or not to open a full estate depends on the value of the assets that the deceased owns on the date of their death, but also has to consider the people who are going to benefit from the estate.. There are three types of abbreviated estate administration. Those are (1) Collection of Property by Affidavit, (2) Administration by Clerk, and (3) Summary Administration. If there is a surviving spouse, there may be other options open to them to move personal property into their name.
Gain control over and inventory the decedent’s property.
Once appointed, the Personal Representative must go to the decedent’s financial institutions to take control over bank accounts and other personal property. That property must be held in an estate trust account, either at a bank or with an attorney’s office.
The Personal Representative must also collect anything that is owed to the decedent. This includes interest payments, dividend payments, and rental income. They must also collect and preserve the decedent’s property, such as vehicles and other personal property.
Finally, the Personal Representative may have to apply for an Employer Identification Number (EIN) from the IRS and open a deposit account titled in the name of the estate.
For a full estate, publish notice of the open estate to decedent’s creditors and notify known creditors of the deceased.
This notification is basically an advertisement that tells the creditors of the decedent’s death and asks them to make their claims against the estate. The notice must state a deadline by which the creditors have to submit their claims. This deadline must be at least three (3) months in the future. For certain creditors, such as creditors known by the Personal Representative, you might have to send them a letter individually.
Months Three – Six.
Consider spousal privileges, such as whether a year’s allowance needs to be paid.
The surviving spouse and the surviving minor children of the decedent are automatically entitled to a year’s allowance that is paid out of the estate’s probate property. These allowances are in a high priority of pay-out compared to other distributions.
The surviving spouse, or someone acting on the child’s behalf, must apply using the “Application and Assignment Year’s Allowance”.
Note: that because the year’s allowances are priority claims, they must be paid prior to distributing money to any heirs or devisees or paying the estate’s debts.
File a 90-day inventory.
The Personal Representative will have ninety (90) days to file a detailed inventory of the decedent’s property. The time frame for this deadline begins on the date that the Personal Representative is appointed.
This inventory needs to include the estimated value of each item, which might require an appraisal from a professional.
Months Four - Eight.
Sell Real Estate.
Often heirs or devisees wish to sell inherited property. Often, to sell real property a full estate has to be open in order to clear ownership title. Typically, real estate can be sold after the Notice to Creditors has run for three (3) months.
Pay off the decedent’s debts.
Once the deadline for the Notice to Creditor has run, the Personal Representative has to pay off the debts according to a specific order found in the N.C. General Statutes. To pay these debts, the Personal Representative uses the decedent’s assets. Sometimes, the Personal Representative may need to use the decedent’s real property or non-probate assets to pay off these debts. If that is the case, you may have to acquire the right to those assets by petitioning to the Clerk of Superior Court.
Distribute Inheritance to the Heirs or Devisees.
After all the debts/claims have been paid, the remaining money needs to be distributed in accordance to the will or according to the North Carolina General Statutes. It is smart to keep all receipts of any disbursements, just in case.
Take care of the decedent’s taxes and accounting.
The personal representative is responsible for filing the estate tax return and the decedent’s individual tax return. This type of tax filing can be complicated so you may need to meet with a tax professional.
Months Four - Twelve.
Close the estate.
The Clerk of Superior Court will ask for a final accounting before he or she closes the estate. This will include a detailed list of all estate transactions along with copies of receipts, statements, and checks. Once the clerk is satisfied, you will be relieved of your responsibility as personal representative and you are done.
If the estate takes longer than a year, you need to do provide the Clerk of Superior Court with annual accounting.
We strongly suggest you contact us if a loved one has passed and you are unclear of who should receive the deceased's assets, or if there are conflicts among heirs and/or beneficiaries of an estate or trust. Also, please make an appointment with us, if the deceased owned real property, such as land or buildings, or if they were a business owner or partner. These aspects of estate administration can become serious legal issues quickly. If you need legal assistance with these types of issues, we encourage you to schedule a consultation with one of our lawyers by contacting us online or by phone at (704) 873-7233.