Do joint bank accounts need to be included on the probate inventory, and what happens if funeral expenses were paid from a joint account? – North Carolina

Short Answer

In North Carolina, a true joint account with right of survivorship usually passes to the surviving co-owner outside of probate, so it is often not listed as a probate asset on the inventory. However, survivorship funds can still be reachable in a limited way if the estate does not have enough probate assets to pay certain items, including funeral expenses. If funeral expenses were paid from a joint account, that payment is typically treated as paid by the joint owner (not the estate), and reimbursement may be possible depending on the account type and whether the estate has funds.

Understanding the Problem

In a North Carolina estate administration, the personal representative must file an inventory that lists what property is part of the estate being administered. The key decision point is whether a joint bank account is a probate asset that belongs on the inventory, or a non-probate asset that passes by survivorship to the co-owner. A related issue comes up when funeral costs were paid from a joint account: whether that payment should be shown on the estate inventory or accounting, and whether the estate must reimburse the person who paid.

Apply the Law

North Carolina generally treats a joint account with right of survivorship as passing to the surviving joint owner by contract at death, not through the will or intestacy. Even so, North Carolina law can allow a personal representative to reach certain non-probate assets (including survivorship accounts) to pay specific estate obligations if the estate’s probate assets are not enough. The inventory filed with the Clerk of Superior Court is meant to report property subject to administration, and it is common to separate (1) probate assets from (2) property that is not a probate asset but may be recoverable if needed to pay claims.

Key Requirements

Identify the account type: Determine whether the account is (a) joint with right of survivorship, (b) joint without survivorship/tenants in common, or (c) another form of multi-party account governed by the account contract and North Carolina statutes.
Decide whether it is a probate asset: If the decedent’s share is payable to the estate (for example, a joint account without survivorship), that share is typically an estate asset that belongs on the inventory.
Track funeral payments correctly: If funeral expenses were paid from a joint survivorship account, the estate may treat the funeral bill as already paid, but the payer may have a reimbursement claim depending on the circumstances and available estate assets.

What the Statutes Say

N.C. Gen. Stat. § 54B-129 (Joint accounts) – Explains that funds in a joint account with right of survivorship belong to the surviving joint tenant at death, while recognizing a limited personal representative collection right in certain situations.

Analysis

Apply the Rule to the Facts: Probate is already open and the personal representative is preparing the inventory filing. The main task is to classify any joint bank accounts as either estate assets (to be inventoried as property subject to administration) or non-probate survivorship property (often not inventoried as an estate asset, though it may be noted in the “recoverable if needed” category depending on local practice). If funeral expenses were paid from a joint account, the inventory usually does not change because of the payment itself, but the estate’s accounting and any reimbursement request may depend on whether the estate has enough probate assets and whether the payment is treated as an advance by the surviving joint owner.

Process & Timing

Who files: The personal representative. Where: The Clerk of Superior Court (Estates) in the county where the estate is opened. What: The estate inventory form required by the clerk. When: Typically within about 90 days after qualification, unless the clerk grants an extension.
Classify each joint account: Obtain the signature card/account agreement or a bank letter confirming whether the account had right of survivorship and the date-of-death balance. If the account is joint without survivorship, list the decedent’s share as an estate asset. If it is survivorship, treat it as non-probate, but be prepared to disclose it if the estate may need to reach it to pay allowed items.
Handle the funeral payment: Keep the funeral invoice and proof of payment. If the estate reimburses the payer, show that reimbursement in the estate accounting as an estate disbursement (and keep documentation). If no reimbursement occurs, document that the funeral expense was paid outside the estate so the estate does not pay it twice.

Exceptions & Pitfalls

Not all “joint” accounts are the same: Some accounts are joint without survivorship, and in that situation the decedent’s portion can be an estate asset that belongs on the inventory.
Local clerk practice can affect how survivorship accounts are shown: Some clerks want survivorship or payable-on-death accounts listed in a section for property that may be recoverable if needed to pay claims, especially if the decedent’s share cannot be determined cleanly from records.
Funeral paid from a joint account can create a reimbursement dispute: If the surviving joint owner paid the funeral bill from a survivorship account, other heirs may argue it was the survivor’s money, while the survivor may argue the estate should reimburse. Clear documentation and consistent reporting in the accounting helps avoid conflict.
Do not double-pay the funeral bill: If the funeral home has already been paid from a joint account, the estate should not pay the same invoice again unless it is reimbursing the person who paid and the reimbursement is properly documented.

Conclusion

In North Carolina, a joint bank account with right of survivorship usually is not a probate asset and often does not get listed on the inventory as property subject to administration, even though it may be reachable in limited circumstances if the estate lacks funds to pay items like funeral expenses. If funeral costs were paid from a joint account, the estate should document the payment and decide whether reimbursement is appropriate based on the account type and available probate assets. The next step is to obtain written confirmation of the account’s survivorship terms and list the account (or the decedent’s share) on the inventory in the correct category by the inventory deadline.

Talk to a Probate Attorney

If probate is open and the inventory is due, and there are joint accounts or funeral payments that could affect what must be disclosed and how the accounting should be handled, our firm has experienced attorneys who can help explain 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.