Jan182026
Probate Q&A Series

Will I get in trouble for withdrawing money from the deceased person’s account around the time they died if I had a power of attorney? – North Carolina

Short Answer

In North Carolina, a power of attorney generally stops at the moment of the principal’s death, so withdrawals made after death can create serious problems even if the agent meant well. Withdrawals made shortly before death can also be questioned if they were not clearly for the parent’s benefit or were not well documented. That said, North Carolina law can protect an agent (and the bank) for actions taken in good faith without actual notice of the death, but the safest course is to stop using the power of attorney immediately once death is known and shift to estate administration through the Clerk of Superior Court.

Understanding the Problem

In a North Carolina probate case, the key question is whether an agent acting under a parent’s power of attorney can withdraw money from the parent’s bank account around the time of death without facing consequences. The decision point is timing and authority: did the withdrawal happen before death (while the power of attorney was still effective), or after death (when authority usually ends and the estate process takes over). This issue often comes up when an estate is opened and the personal representative needs accurate date-of-death values for accounts and other assets so the inventory and distributions among beneficiaries can be handled fairly.

Apply the Law

Under North Carolina law, a power of attorney is an agency relationship. As a general rule, the agent’s authority ends at the principal’s death, and control of the deceased person’s property shifts to the personal representative (executor/administrator) acting through the estate. North Carolina also has statutes that can protect actions taken under a power of attorney after death if the agent acted in good faith without actual knowledge or notice of the death, and separate statutes that protect certain financial institutions that honor a power of attorney until they receive notice of death.

Key Requirements

  • Authority at the time of the withdrawal: The power of attorney must still be effective when the money was taken; once death occurs, the agent’s authority generally ends and the estate becomes the proper channel.
  • Good faith and lack of actual notice (if the withdrawal was after death): North Carolina law can treat some post-death actions as binding if the agent acted in good faith without actual knowledge or actual notice of the death.
  • Purpose and documentation: Even if a withdrawal was technically authorized, it can still create trouble if it looks like the money was used for someone other than the parent or the estate, or if records are missing when the estate inventory and accounting are prepared.

What the Statutes Say

Analysis

Apply the Rule to the Facts: Here, the estate is open and the inventory needs to be corrected to reflect accurate date-of-death values for bank accounts and a vehicle so beneficiaries can be treated evenly. If money was withdrawn using a power of attorney close to the parent’s death, the main risk is that the withdrawal occurred after death (when the power of attorney generally no longer authorizes anything) or that the withdrawal was not clearly for the parent’s benefit (before death) or for proper estate expenses (after death under the personal representative’s authority). When the inventory is amended and the estate accounting is prepared, unexplained withdrawals can trigger objections from beneficiaries and questions from the Clerk of Superior Court.

Process & Timing

  1. Who addresses it: The personal representative (executor/administrator) of the estate. Where: The Estates Division of the Clerk of Superior Court in the county where the estate is administered in North Carolina. What: A corrected or supplemental filing that updates asset values and clarifies transactions affecting estate property (often supported by bank statements showing the date-of-death balance and transaction history). When: As soon as the issue is identified, because later distributions and the final account depend on accurate figures.
  2. Gather proof: Obtain date-of-death bank balances, statements covering the period immediately before and after death, and documentation showing what each withdrawal paid for (for example, final medical bills, funeral costs advanced by a family member, or reimbursements that can be traced).
  3. Correct the record and align distributions: Update the inventory values to date-of-death figures and ensure any questionable withdrawals are either repaid to the estate, treated as an advance against a beneficiary’s share (if appropriate), or otherwise documented so the final accounting matches what actually happened.

Exceptions & Pitfalls

  • “I didn’t know they had died” issues: North Carolina law can protect certain actions taken in good faith without actual knowledge or notice of death, but that protection is fact-specific and can collapse if there are signs of fraud or if the agent actually knew of the death.
  • Mixing funds: Using the deceased person’s account to pay personal expenses, or moving money into an agent’s personal account without a clear paper trail, is a common trigger for disputes and can lead to demands for repayment and potential criminal allegations in extreme cases.
  • Inventory and valuation confusion: Probate inventory reporting typically focuses on date-of-death values. If withdrawals changed the balance around death, the estate may still need to report the correct date-of-death value and then separately account for what happened to the funds.
  • Bank “allowed it” is not the same as “it was authorized”: Even if a financial institution honored the power of attorney before it received notice of death, that does not automatically resolve whether the agent’s use of the funds was proper as between the agent, the estate, and the beneficiaries.

For more on how inventories work in an estate administration, see how to fill out the probate inventory form and what information is typically needed to support it.

Conclusion

In North Carolina, a power of attorney generally stops at death, so withdrawals made after death can create legal exposure and probate problems, especially if they cannot be tied to proper expenses and documented. Withdrawals made shortly before death can also be challenged if they do not clearly benefit the parent or if records are incomplete. The practical next step is to gather the bank statements showing the date-of-death balance and the transactions around death, then file a corrected inventory/accounting update with the Clerk of Superior Court as soon as the discrepancy is identified.

Talk to a Probate Attorney

If a power of attorney was used to withdraw funds around the time of a parent’s death and the estate inventory or distributions now need to be corrected, our firm has experienced attorneys who can help explain the rules, reduce conflict among beneficiaries, and get the probate filings back on track. 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.

Category: Probate Q&A Series

Author: Pierce Law

Pierce Law Group is a North Carolina law firm focused on probate administration, real estate partition matters, and surplus funds claims across North Carolina. We know these situations often come with stress, family dynamics, and time-sensitive decisions—so we prioritize clear communication, steady guidance, and a practical plan from day one. Our goal is to make a complicated process feel manageable, while protecting what matters most to you.