Short Answer

Yes. After the estate pays the decedent’s expenses and claims, your share belongs to you and you may use it to pay your debts. If you sign a renunciation (disclaimer) of an inheritance—like an annuity benefit—you will not receive that asset and cannot use it to pay debts. Renunciations in North Carolina have strict content, filing, and timing rules.

Understanding the Problem

In North Carolina probate, can you—as a beneficiary—use your inheritance to pay your own debts? You already have an agreement and a hearing notice about disclaiming rights to an annuity. The single decision point is whether to accept the distribution (and then pay debts) or file a renunciation so the annuity passes to the next taker.

Apply the Law

North Carolina law requires the personal representative to pay estate expenses and valid claims before distributing assets. Once distributed, a beneficiary may use their share for any lawful purpose, including paying personal debts. By contrast, a renunciation (also called a disclaimer) lets a beneficiary refuse some or all of an interest, in whole or in part, by a written, signed, and acknowledged filing with the Clerk of Superior Court within a defined time. A timely renunciation relates back so the interest passes as if the renouncing person predeceased, meaning the beneficiary never receives the asset and cannot direct it to creditors. The Clerk of Superior Court (Estates Division) is the main forum for these filings. A present-interest renunciation generally must be filed within nine months of when the transfer became complete (usually the date of death).

Key Requirements

• Estate pays first: The personal representative pays costs and allowed claims before distributing assets to beneficiaries.
• Your share after distribution: Once you receive your inheritance, you may use it to pay your debts; judgment creditors may pursue normal collection remedies against you.
• Renunciation mechanics: A renunciation must be in writing, identify the transferor and the interest, state the extent of the renunciation (all or a fractional share), be signed and acknowledged, and be filed with the proper Clerk.
• Timing and effect: File a renunciation of a present interest within nine months; a timely filing treats you as having predeceased, so you will not receive the disclaimed asset.
• Limits on renouncing: You cannot renounce after assigning, pledging, or contracting to transfer the interest; renunciations are binding once made.

What the Statutes Say

• North Carolina Gen. Stat. § 28A-14-1 (Notice to creditors) – Personal representative publishes/serves notice and waits at least three months for claims.
• North Carolina Gen. Stat. § 28A-19-6 (Order of payment of claims) – Sets priority for paying estate expenses and creditor claims before distribution.
• North Carolina Gen. Stat. § 31B-2 (Procedure for renunciation) – Content, filing place, and timing for valid renunciations.
• North Carolina Gen. Stat. § 31B-3 (Effect of renunciation) – Disclaimed interests pass as if the renouncing person predeceased.

Analysis

Apply the Rule to the Facts: You want to use part of your inheritance to pay personal debt. If you accept your distribution, those funds are yours and can be applied to debt after the estate’s claims are handled. But your papers involve disclaiming an annuity. If you sign a renunciation of that annuity, you will not receive it and cannot use it to pay debts. Because North Carolina allows partial renunciations, you could renounce only a fractional share if that aligns with your goals and the annuity issuer recognizes it.

Process & Timing

1. Who files: A beneficiary who wants to renounce an interest. Where: Clerk of Superior Court, Estates Division, in the county where the estate is administered in North Carolina. What: A written, signed, and acknowledged renunciation describing the annuity interest and the extent (whole or fractional); there is no pre-printed AOC form. When: File within nine months of when the transfer became complete (usually the date of death).
2. Deliver copies of the renunciation to the proper parties (for an annuity, typically the insurer/plan administrator and the personal representative). If a hearing is noticed, the Clerk may confirm the filing and its effect. County practices and scheduling vary.
3. After the notice-to-creditors window (at least three months from first publication), the personal representative makes distributions. If you did not renounce, you receive your share, and you may then use it to pay your debts.

Exceptions & Pitfalls

• Disclaimers are irrevocable and relate back; you cannot direct a disclaimed annuity to your creditors or choose who receives it.
• You cannot renounce after assigning, pledging, or contracting to transfer the interest; doing so blocks a valid renunciation.
• Judgment or collection actions against you may reach funds you accept; consider timing and protection strategies before taking distributions.
• For real property, additional recording steps may apply; and for nonprobate assets like annuities, notify the issuer so they honor the renunciation.
• Local procedures and deadlines can change; confirm county-specific filing requirements with the Clerk of Superior Court.

Talk to a Probate Attorney

If you’re weighing whether to accept or renounce an annuity or other inheritance, our firm can review your paperwork, explain your options, and help you meet the deadlines. Call us today to discuss a limited-scope review.

Disclaimer: This article provides general information about North Carolina law based on the single question stated above. It is not legal advice for your specific situation and does not create an attorney-client relationship. Laws, procedures, and local practice can change and may vary by county. If you have a deadline, act promptly and speak with a licensed North Carolina attorney.