How to Reimburse Creditor Claims, Distribute Estate Funds and Submit an Affidavit of Collection in North Carolina

Detailed Answer

When you administer a North Carolina estate, you must follow state rules for paying debts, handling joint accounts and collecting personal property. This process involves three key steps.

1. Reimbursing Creditor Claims

After the personal representative publishes notice in a local paper and mails notice to known creditors, allow creditors a three-month window to file claims per N.C. Gen. Stat. § 28A-19-1 and § 28A-20. Once the deadline passes, file a petition for allowance of claims with the clerk’s office. The clerk reviews claims and approves amounts. You must pay approved claims in this order:

• Costs of administration (court fees, attorney fees).
• Funeral expenses (up to $10,000).
• Expenses of last illness and estate administration.
• All other debts and taxes.

Record each payment. If the estate lacks enough funds, pay claims pro rata or follow statutory abatement rules.

2. Distributing Estate Funds via a Joint Account

Joint bank accounts with right of survivorship pass automatically to the surviving account holder. These funds do not enter probate and do not form part of the estate assets. If you manage such funds during administration, confirm that the account includes a surviving joint tenant. Do not treat these funds as estate property for creditor claims or beneficiary distributions. To distribute probate assets, write estate checks or transfer funds per the Will or North Carolina’s intestacy rules. Always keep separate records for joint account transactions and probate distributions.

3. Submitting an Affidavit of Collection

North Carolina allows personal representatives to collect personal property under $20,000 by affidavit instead of full probate. Under N.C. Gen. Stat. § 28A-25-1, complete an Affidavit of Collection form. At minimum, include:

• Decedent’s name and date of death.
• Your name and role as personal representative.
• Description and value of goods and chattels.
• Statement that total personal property does not exceed $20,000.
• Copy of the death certificate.

Sign the affidavit under oath before a notary. File it with the clerk’s office if required, or present it directly to the holder of the property. Once accepted, the holder must release the items to you.

Checklist for Efficient Estate Administration

• File notice to creditors and provide claim forms.
• Track all incoming claims and file a petition for approval.
• Pay approved claims in statutory priority.
• Review joint account titles before distributing funds.
• Separate joint account balances from probate assets.
• Prepare and notarize an Affidavit of Collection for small personal property.
• Attach a certified copy of the death certificate.
• File or present the affidavit to the property custodian.
• Maintain clear records of all transactions.
• Adhere to deadlines under N.C. Gen. Stat. Chapter 28A.

If you need help navigating creditor reimbursements, joint account transfers or Affidavits of Collection, turn to Pierce Law Group. Our attorneys have deep experience guiding families through North Carolina probate. Contact us today by email at intake@piercelaw.com or call us at (919) 341-7055 to schedule a consultation.