Detailed Answer
When someone dies, their estate covers funeral costs and probate expenses. Under North Carolina law, these items qualify as preferred claims. The personal representative pays them from estate funds before most other bills. You generally do not have to tap your personal joint account to settle these costs.
Why? Joint accounts with right of survivorship pass automatically to the surviving owner. Those funds stay outside probate. The personal representative cannot reach them unless they contain money that actually belonged to the decedent. If the decedent funded part of the account, the representative may trace that portion and ask for repayment. But you don’t have to use personal funds to cover estate bills.
North Carolina statutes direct how to handle preferred claims. G.S. 28A-13-1 requires the estate to pay administration costs and funeral charges first. G.S. 28A-13-2 sets caps on funeral and cemetery expenses. If the estate lacks enough cash, the personal representative may advance money—often from their own funds—and later receive reimbursement from the estate.
Statutory Caps on Funeral and Cemetery Expenses
North Carolina limits how much an estate can pay for these items:
- Funeral charges up to $7,500.
- Cemetery or burial plot expenses up to $1,500.
The estate may also pay reasonable medical or last-illness bills. The law does not set a specific cap on those costs, but they must reflect fair market value.
In short, you do not have to use your joint account to cover probate costs. Use estate assets first. If you unintentionally cover expenses from your joint account, expect the personal representative to seek reimbursement, subject to the statutory limits above.
Key Points to Remember
- Funds in a joint account with right of survivorship pass outside probate.
- Probate expenses and funeral charges are preferred claims under G.S. 28A-13-1.
- Funeral costs cap at $7,500; cemetery expenses cap at $1,500 per G.S. 28A-13-2.
- Medical or last-illness expenses must be reasonable but lack a fixed statutory cap.
- If you pay from a joint account, the estate may trace and recover decedent’s portion.
Take the Next Step
Navigating probate and estate claims can feel overwhelming. At Pierce Law Group, our attorneys guide you through every step. For clear advice on joint accounts, funeral expenses, and estate administration, email us at intake@piercelaw.com or call (919) 341-7055.
