Short Answer

In North Carolina, the Clerk of Superior Court sets a personal representative’s commission at a reasonable amount not to exceed 5% of commissionable receipts and disbursements. In an insolvent estate (debts exceed assets), commissions are a cost of administration that come ahead of creditor claims and are calculated on amounts actually received and paid to creditors (not on distributions to heirs, and not on the commission itself). To avoid circular math, compute the commission on receipts plus disbursements excluding the commission and seek clerk approval before paying it.

Understanding the Problem

You’re serving as personal representative in North Carolina and need to figure out the Clerk of Superior Court’s commission when the estate’s loan and other debts are larger than the available assets. You want to know how to calculate the commission in an insolvent estate so you can pay creditors correctly and close the file.

Apply the Law

North Carolina law allows a commission to the personal representative based on the estate’s commissionable receipts and disbursements, capped at 5%, and subject to the clerk’s discretion. “Receipts” generally means personal property the representative actually collects; “disbursements” are payments the representative actually makes for estate expenses and creditor claims. Distributions to heirs are not commissionable. The commission is an administration cost that has priority over creditor claims, and the clerk must approve it before payment.

Key Requirements

• Commission base: Up to 5% of all commissionable receipts plus commissionable disbursements; distributions to heirs do not count.
• Priority over creditors: Commissions are administration costs that come before creditor claims in an insolvent estate.
• Clerk approval: The Clerk of Superior Court must approve the commission; do not pay it in advance.
• Discretionary amount: The cap is not automatic; the clerk considers the time, responsibility, trouble, and skill involved.
• Real property nuance: If real property is sold to pay debts or legacies, only the portion actually used for those payments is commissionable.
• Will terms may control: If a will sets a different method or amount, that may govern, subject to statute.

What the Statutes Say

• North Carolina Gen. Stat. § 28A-23-3 (Compensation of personal representative) – Commission up to 5% of receipts and disbursements; priority; clerk approval; limits and will provisions.
• North Carolina Gen. Stat. § 7A-241 (Clerk as judge of probate) – Confirms the clerk’s role and forum for estate matters.

Analysis

Apply the Rule to the Facts: Because debts exceed assets, every dollar collected will be disbursed to administration costs and creditors. Your commission is calculated on commissionable receipts and disbursements but not on distributions to heirs and not on the commission itself. Since the commission is paid before creditors, compute it on amounts actually received and actually paid to creditors/expenses, excluding the commission, then seek the clerk’s approval.

Process & Timing

1. Who files: The personal representative. Where: Clerk of Superior Court in the county where the estate is administered. What: A written petition or request for commissions supported by a current accounting (Annual Account or Final Account) showing actual receipts and disbursements. When: Typically with the Final Account; interim commissions may be requested during administration with an accompanying accounting.
2. After filing, the clerk reviews your accounting and considers reasonableness (time, responsibility, trouble, and skill). Processing times vary by county; some clerks rule at the account review.
3. The clerk issues a written order setting the commission amount. You then pay the approved commission from estate funds as a cost of administration.

Exceptions & Pitfalls

• If the will sets compensation differently (or ties it to a schedule), follow that provision if allowed by statute.
• Do not include distributions to heirs in the commission base; they are non‑commissionable.
• For real property sold to pay debts, only the portion actually applied to debts/legacies is commissionable.
• Do not pay a commission before the clerk approves it; premature payment can lead to objections or removal.
• The 5% is a cap, not a guarantee; provide detail supporting the reasonableness of your request.

Conclusion

In North Carolina, a personal representative’s commission is a clerk‑approved, reasonable amount capped at 5% of commissionable receipts plus commissionable disbursements. In an insolvent estate, the commission is an administration cost with priority over creditors and is calculated on actual receipts and payments to creditors/expenses, excluding the commission and any heir distributions. Next step: file a written commission request with a current accounting for the Clerk of Superior Court’s approval.

Talk to a Probate Attorney

If you’re dealing with an insolvent estate and need to calculate the clerk-approved commission, our firm has experienced attorneys who can help you understand your options and timelines. Call us today at [919-341-7055].

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.