Short Answer

Yes. In North Carolina, the beneficiary designation on a nonprobate asset (like an IRA or life insurance) generally controls who gets the funds at death, regardless of the will. An absolute divorce automatically cancels gifts to the former spouse in a will, but it does not automatically cancel beneficiary designations; those must be changed with the account custodian. A divorce decree or separation agreement may be enforceable between the parties, but the payor usually follows the form on file.

Understanding the Problem

You want to know whether, under North Carolina law, your ex-spouse can still inherit retirement funds when the IRA’s beneficiary form names you, even though you are now divorced. The core decision point is: if you are listed on the IRA beneficiary designation, can that override contrary language in a will or divorce decree?

Apply the Law

North Carolina treats most retirement accounts, life insurance, and payable-on-death accounts as nonprobate assets. They pass by contract to the person named on the beneficiary form on file at death. A will does not control those assets unless the estate is the named beneficiary. After an absolute divorce, North Carolina law automatically revokes provisions in a will that favor the former spouse, but it does not automatically revoke beneficiary designations; the account owner must submit a new designation. If a divorce judgment or separation agreement includes a clear waiver or direction about beneficiary rights, courts may enforce that agreement between the parties even if the payor followed the designation form at payout. Disputes over estates are typically handled before the Clerk of Superior Court, and questions needing a court declaration can be brought in Superior Court.

Key Requirements

• Nonprobate controls: For IRAs and similar accounts, the named beneficiary of record at death is paid, not the person named in the will.
• Divorce-and-will rule: An absolute divorce automatically revokes gifts and appointments in a will in favor of the former spouse unless the will says otherwise.
• No automatic change to forms: Divorce does not by itself change IRA or insurance beneficiary designations; the owner must file a new form with the custodian.
• Agreements matter (between parties): A divorce decree or separation agreement that waives or requires beneficiary rights can be enforceable between the parties, even if the custodian paid the person on the form.
• Forum and triggers: Estate questions start with the Clerk of Superior Court; requests for a court declaration can be filed in Superior Court. The revocation of will provisions applies only after an absolute divorce is final.

What the Statutes Say

• North Carolina Gen. Stat. § 31-5.4 (Divorce or annulment) – Absolute divorce revokes will provisions in favor of a former spouse unless the will provides otherwise.
• North Carolina Gen. Stat. § 28A-2-4 (Estate proceedings; declaratory relief) – Clerk of Superior Court has original jurisdiction over estate proceedings; courts may grant declaratory relief on estate questions.

Analysis

Apply the Rule to the Facts: Because the account is an IRA, it is a nonprobate asset. If you remain the named beneficiary on the IRA when your ex-husband dies, the custodian will typically pay you even though the will cannot benefit a former spouse after an absolute divorce. If the divorce decree says you will or will not receive the IRA, the custodian still follows the form, but the decree can be enforced between the parties (for example, through a claim to recover funds if a waiver was violated).

Process & Timing

1. Who files: The account owner. Where: With the IRA custodian or plan administrator. What: Submit an updated “Beneficiary Designation” form. When: As soon as possible after separation and upon entry of an absolute divorce to align designations with intent.
2. If the owner dies without updating, the custodian pays the beneficiary of record. If there is a conflict with a divorce decree or waiver, an interested party may seek relief. Where: Declaratory judgment in Superior Court in the decedent’s county; related estate matters may proceed before the Clerk of Superior Court. Timing: Timeframes vary; act promptly because limitation periods and plan deadlines can apply.
3. Final step: Court order or settlement determines rights consistent with the designation rules and any enforceable divorce agreement.

Exceptions & Pitfalls

• Employer plans vs. IRAs: Some employer retirement plans are governed by federal law, which can require payment to the named beneficiary unless there is a qualifying domestic relations order; different rules can apply than for IRAs.
• Separation isn’t enough: Separation or a pending divorce does not revoke will provisions; only an absolute divorce triggers the will-revocation statute.
• Assuming the will controls: A new will cannot redirect an IRA unless the estate is the named beneficiary; change the beneficiary form with the custodian.
• Vague waivers: Divorce or separation agreements should be clear about beneficiary rights; unclear language can be hard to enforce.
• Notice to payors: Provide plan administrators or custodians with updated forms and any court orders; they generally pay based on their records.

Talk to an Estate Planning Attorney

If you’re dealing with beneficiary designations, a divorce decree, and questions about who inherits a retirement account, our firm has experienced attorneys who can help you understand your options and timelines. Call us today at .

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.