How to Formally Disclaim an Inherited Interest in a Jointly Owned Property?

How to Formally Disclaim an Inherited Interest in a Jointly-Owned Property in North Carolina

Detailed Answer

North Carolina allows an heir or devisee to refuse (“disclaim”) all or part of property that would otherwise pass to them. The governing law is the North Carolina Uniform Disclaimer of Property and Powers Act (N.C. Gen. Stat. §§ 31B-1 et seq.). A properly executed disclaimer treats the person as if they had predeceased the decedent, so the interest passes to the next eligible taker under the will or the intestacy rules.

Six basic steps

1. Confirm the nature of your ownership. Determine whether you held the property jointly with right of survivorship or as tenants in common. Survivorship interests pass instantly at death; tenants-in-common shares pass through probate. Either interest may be disclaimed, but the delivery requirements differ.
2. Act before key deadlines. North Carolina places no absolute time limit on filing a disclaimer, but the IRS requires a qualified disclaimer to be made within 9 months of the decedent’s death to avoid gift-tax consequences (26 U.S.C. § 2518).
3. Draft the written disclaimer. Under § 31B-3, the document must:
   • Be in writing;
   • Identify the creator of the interest (the decedent) and the property being disclaimed;
   • Describe the extent of the disclaimer (all or a fractional share);
   • Be signed by the disclaimant and acknowledged before a notary.
4. Deliver and file the disclaimer.
   • Personal property: deliver the original to the estate’s personal representative (§ 31B-7).
   • Real property: also record a certified copy in the Register of Deeds in every county where the land lies (§ 31B-8).
5. Notify co-owners and interested parties. Although the statute requires delivery only to the personal representative, informing surviving co-owners prevents confusion about future title transfers or sales.
6. Update related documents. Remove your name from insurance, tax, and utility accounts for the property to reflect the disclaimer.

Hypothetical Example

Mary and her brother James owned a lake house as joint tenants with right of survivorship. When James died, Mary became the sole owner by operation of law. Within five months, Mary decided she did not want the property. She:

• Prepared a written disclaimer referencing James A. Smith, deceased 2/1/2024, Lake House Parcel #1234.
• Signed before a notary.
• Recorded the disclaimer in the county Register of Deeds.
• Delivered copies to the probate clerk (there was a small estate file) and to James’s children, the next heirs at law.

The lake house passed to James’s children as if Mary had died before James.

Helpful Hints

• Use precise legal descriptions from the most recent deed to avoid recording rejections.
• If a mortgage exists, disclaiming does not extinguish the loan; the next taker assumes the debt.
• Do not occupy or collect rent from the property after the disclaimer—doing so can void a qualified disclaimer for tax purposes.
• File the disclaimer even if the estate is unsupervised; the public record protects future buyers.
• If multiple heirs wish to disclaim, each must file a separate document.

Need guidance? Disclaiming real estate is detail-oriented and deadline-driven. Our North Carolina probate attorneys have handled countless disclaimers and real-property transfers. Call us today at (919) 341-7055 to protect your interests and keep the process on track.