Jan72026
Estate Planning Q&A Series

How are property taxes, insurance, repairs, and other costs supposed to be handled when there is a life estate? – North Carolina

Short Answer

In North Carolina, the life tenant is generally responsible for the ongoing carrying costs of the property during the life estate—especially property taxes—and for keeping the property in reasonable condition. If the life tenant does not pay the property taxes, North Carolina law allows a remainderman to pay them and then seek reimbursement from the life tenant, and the life tenant can be liable for damages if tax nonpayment leads to a tax foreclosure. Costs that are more like long-term “capital” improvements or special assessments may be handled differently, and the will (or other creating document) can change the default rules.

Understanding the Problem

When a North Carolina will creates a life estate, a common question is: who must pay the property’s ongoing bills while the life tenant has the right to possess and use the home, and the siblings (as remaindermen) hold the future ownership interest. The decision point is how North Carolina law allocates responsibility for property taxes, insurance, repairs, and similar expenses between the life tenant and the remaindermen during the life estate. The answer often turns on whether a cost is an ordinary, recurring expense of living in and maintaining the property, or a long-term cost that primarily benefits the remainder interest.

Apply the Law

A life estate splits ownership into two parts: (1) the life tenant’s present right to possess and use the property for life, and (2) the remaindermen’s right to take full ownership when the life estate ends. North Carolina’s default approach is that the life tenant pays the routine, ongoing costs tied to possession and use, and must not let the property fall into disrepair in a way that harms the remaindermen’s future interest. The creating document (here, the parent’s will) can override these defaults, so the first step is always to read the will’s life-estate language closely.

Key Requirements

  • Life tenant pays ongoing taxes: North Carolina places the duty to pay property taxes on the life tenant while the life estate exists.
  • Life tenant maintains the property: The life tenant is expected to handle ordinary upkeep and repairs so the property does not deteriorate beyond normal wear and tear.
  • Remaindermen can protect the future interest: If the life tenant fails to pay certain required charges (especially taxes), the remaindermen may pay to protect the property and then pursue reimbursement or other remedies allowed by law.

What the Statutes Say

Analysis

Apply the Rule to the Facts: Here, several siblings want to revisit a life estate created by a deceased parent’s will. Under North Carolina’s default rules, the life tenant typically pays the recurring carrying costs tied to possession—most importantly the annual property taxes—and handles ordinary repairs and upkeep. If the life tenant is not paying taxes (or is letting the property deteriorate), the remaindermen often focus on protecting the property from tax enforcement and documenting condition and expenses, because the remainder interest can be harmed long before the life estate ends.

Process & Timing

  1. Who acts: Usually the life tenant pays routine bills; remaindermen act if the life tenant is not paying or the property is at risk. Where: Property tax payments and delinquency status are handled through the county tax office where the property is located; disputes about reimbursement or damages are typically handled in the North Carolina General Court of Justice in the county where the real property sits. What: Key documents often include the will (and any recorded deed reflecting the life estate), tax bills and payment history, insurance declarations, repair invoices, and written communications about needed repairs.
  2. If taxes are not being paid: A remainderman may choose to pay delinquent taxes to prevent tax enforcement and then pursue reimbursement from the life tenant as allowed by N.C. Gen. Stat. § 105-384. Timing matters because tax delinquency can escalate to enforced collection steps, and delays can increase costs and risk.
  3. If there is disagreement about repairs or major expenses: The parties often start by reviewing the will’s language and then negotiating a written cost-sharing plan (for example, how to handle a roof replacement versus routine maintenance). If agreement is not possible, a court action may be needed to resolve responsibility, reimbursement, or property-protection issues based on the specific facts and the will’s terms.

Exceptions & Pitfalls

  • The will can change the default rules: Some wills require the remainder beneficiaries to contribute to insurance, major repairs, or other costs, or they may authorize using estate or trust funds for certain expenses. The text controls if it is clear and enforceable.
  • Ordinary repairs vs. major improvements: Routine maintenance (for example, minor plumbing fixes, servicing HVAC, yard upkeep) is usually treated differently than a major capital project (for example, a full roof replacement). Disputes often arise when a “repair” also increases value or extends the property’s life.
  • Insurance gaps: Even when the life tenant pays insurance, the policy should match the ownership structure (life tenant and remaindermen interests). Coverage and claim payment issues can arise if the policy names only one interest-holder.
  • Mortgage and liens: If the property is encumbered, missed payments can create foreclosure risk. Responsibility can depend on the will’s terms and the nature of the debt (ongoing interest/escrow vs. principal reduction), and the parties should address this early.
  • Documentation problems: Reimbursement and contribution claims are much harder without proof of payment, proof of delinquency, and clear records showing what was paid and why.

Conclusion

In North Carolina, a life tenant generally must pay the property taxes and handle ordinary upkeep while the life estate is in place, and the remaindermen hold the future ownership interest. If the life tenant does not pay the taxes, a remainderman can pay to protect the property and may seek reimbursement under N.C. Gen. Stat. § 105-384. The most important next step is to review the will’s life-estate language and confirm the property’s current tax status with the county tax office before delinquency escalates.

Talk to a Estate Planning Attorney

If a family is dealing with disagreements about who should pay property taxes, insurance, repairs, or other costs during a North Carolina life estate, an attorney can help clarify the will’s terms, explain the default rules, and outline practical options to protect the property and avoid preventable disputes. Call 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: Estate Planning 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.