Jan142026
Guardianship Q&A Series

Can someone on a joint bank account legally withdraw money if the other account holder is incapacitated? – North Carolina

Short Answer

Often, yes. In North Carolina, a joint account is commonly set up so that either named owner can withdraw funds, and the bank can treat a withdrawal by either owner as authorized unless the account contract requires two signatures. But “the bank can pay it” is not the same thing as “the withdrawal was proper between the owners,” especially when one owner is mentally incapacitated and needs funds for care.

Understanding the Problem

In North Carolina, can a co-owner on a joint bank account take money out when the other co-owner is hospitalized and mentally incapacitated and cannot manage decisions or communicate consent? The key decision point is whether the joint account was set up to allow either owner to withdraw on their own, or whether the account requires more than one signature or other restrictions before money can be taken out.

Apply the Law

North Carolina law generally allows a bank to honor withdrawals from a joint account by any person named on the account, unless the account agreement says withdrawals require more than one signature. This rule mainly protects the financial institution when it pays out. Separate from the bank’s ability to pay, disputes between the co-owners (or later, a guardian of the incapacitated person’s estate) can still arise if one co-owner takes funds for reasons that are not consistent with the co-owners’ rights and obligations.

Key Requirements

  • Account contract controls withdrawals: If the account is set up so either owner can withdraw, the bank will usually allow it. If the account requires two signatures, the bank should not pay on one signature alone.
  • Bank “permission” is not the same as ownership: Even when a bank properly pays a joint owner, the other owner (or a later-appointed guardian) may still challenge whether the money was taken for an appropriate purpose and whether an accounting is owed.
  • Guardianship can change who manages finances: If a clerk of superior court appoints a guardian of the estate (or a general guardian), that guardian typically manages the incapacitated person’s property under the clerk’s ongoing supervision, including reporting and accounting requirements.

What the Statutes Say

Analysis

Apply the Rule to the Facts: The facts describe an adult who is hospitalized and mentally incapacitated and now needs round-the-clock care and rehabilitation services. If another person is a named co-owner on a joint account that allows either owner to withdraw, that person can often withdraw funds as far as the bank is concerned. However, because the incapacitated owner cannot consent or monitor spending, withdrawals that are not used for the incapacitated person’s needs can trigger disputes, demands for accounting, or court involvement once a guardian of the estate is appointed.

Process & Timing

  1. Who acts: An interested person (often a family member) may start an adult guardianship case. Where: the Clerk of Superior Court in the county where the adult resides or is present. What: a petition asking the clerk to determine incompetency and appoint a guardian (often a guardian of the estate for finances, or a general guardian). When: as soon as there is a real risk that bills for care cannot be paid safely or that funds may be misused.
  2. Interim protection: In urgent situations, the clerk can address immediate needs through court orders in the guardianship proceeding, and the case can move faster than a standard timeline depending on the risk and the county’s scheduling.
  3. Ongoing oversight: After appointment, a guardian of the estate generally must track assets, keep records, and file required accountings with the clerk, including showing bank statements and cash balances when accounts are filed.

Exceptions & Pitfalls

  • Two-signature accounts: Some joint accounts are set up to require both signatures (or other conditions). In that situation, a co-owner may not be able to withdraw alone, and the bank should follow the contract terms.
  • “Joint” does not always mean “free to spend”: Even if a co-owner can withdraw, taking funds for personal use can create legal exposure if the money should have been used for the incapacitated person’s care or if the withdrawal exceeds the withdrawing owner’s rightful share.
  • Mixing funds and poor records: Using a joint account to pay unrelated expenses, withdrawing cash without receipts, or failing to track spending can become a major problem once a guardian is appointed and the clerk requires accountings.
  • Guardianship vs. convenience access: A joint account is sometimes created for convenience (bill-paying) rather than a true intent to share ownership. That mismatch is a common source of conflict when incapacity occurs.
  • Bank discharge vs. owner dispute: The statutes often protect the financial institution for paying a named joint owner, but they do not necessarily prevent later claims between family members or by a guardian seeking repayment or an accounting.

For more on protecting an incapacitated person’s finances through court involvement, see stop an on-and-off partner from accessing an incapacitated relative’s bank accounts and assets and get a neutral decision-maker appointed to protect them and their finances.

Conclusion

In North Carolina, a person named on a joint bank account can often legally withdraw money even if the other account holder is incapacitated, unless the account agreement requires more than one signature. That said, the withdrawal can still be challenged later if it was not consistent with the owners’ rights or the incapacitated person’s needs. The most practical next step is to file a guardianship petition with the Clerk of Superior Court promptly so a court-supervised fiduciary can manage funds for care.

Talk to a Guardianship Attorney

If you’re dealing with an incapacitated adult who needs round-the-clock care and there are concerns about joint account withdrawals, our firm has experienced attorneys who can help explain options, timelines, and how the clerk of superior court process works. 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: Guardianship 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.