How can the estate handle the SBA insisting on full payment under the personal guarantee when there aren’t enough assets? – North Carolina Short Answer In North Carolina, an estate that cannot pay all debts must follow the statutory order of payment. Costs of administration, liened debts, and limited funeral and gravestone expenses are paid…
Will the estate owe income tax on the canceled loan debt when a 1099-C is issued, even if there are no assets? – North Carolina Short Answer Usually no. Canceled-debt income can be excluded from tax if the taxpayer is insolvent or in bankruptcy. An estate is a separate taxpayer, and if the estate’s liabilities…
What happens if the estate can’t pay the tax liability from a 1099-C because it’s insolvent? – North Carolina Short Answer In North Carolina, an insolvent estate pays claims in a strict statutory order. Federal taxes and other claims owed to the United States (including some SBA claims) sit in the same high-priority class. If…
What steps can I take to gather insurance information for a wrongful death claim linked to the estate? – North Carolina Short Answer In North Carolina, the personal representative (executor or administrator) is the one authorized to investigate and pursue a wrongful death claim and to request insurance information. Start by qualifying with the Clerk…
What happens if I can’t locate or serve notice to a potential co-heir during probate? – North Carolina Short Answer In North Carolina, if a person with equal or higher priority to serve as administrator won’t renounce and you cannot locate them, you can ask the Clerk of Superior Court to treat their right as…
Can I ask the court to appoint me administrator when a next-of-kin refuses to renounce their rights? – North Carolina Short Answer Yes. In North Carolina, if a higher‑priority next‑of‑kin won’t renounce or can’t be located, you can ask the Clerk of Superior Court to proceed by “implied renunciation.” After 30 days from death, the…
Can I protect my house from foreclosure when I co-signed a HELOC and the estate owes more than its value? – North Carolina Short Answer In North Carolina, the lender’s lien on the decedent’s house remains and can be enforced regardless of the estate’s insolvency. As co-signer, you are personally liable for any deficiency if…
Do I need to petition for insolvency or bankruptcy for the estate if liabilities exceed assets? – North Carolina Short Answer In North Carolina, you do not file “bankruptcy” for a decedent’s estate and you do not need a separate petition to declare an estate insolvent. Instead, the personal representative administers the estate as insolvent:…
How can I file an estate accounting when the estate is insolvent and debts exceed assets? – North Carolina Short Answer In North Carolina, you still file the required Annual or Final Account even if the estate is insolvent. Use AOC-E-506 and show all receipts and disbursements, pay claims strictly by statutory priority, and distribute…
How can I handle creditor claims as executor without paying from my personal funds? – North Carolina Short Answer In North Carolina, an executor pays valid creditor claims from estate assets in a strict statutory order. You are not personally liable for estate debts if you follow the notice, claim, and payment rules, avoid paying…
