Short Answer

In North Carolina, the personal representative may use estate funds to pay real-property expenses only if the representative has legal authority over that property. Because title to real estate vests in the heirs at death, the personal representative typically must first obtain an order from the Clerk of Superior Court granting possession, custody, and control of the property, unless the will already grants that authority. Once authorized, necessary charges—like property taxes, essential utilities to preserve the property, insurance, and deed preparation/recording fees to complete distribution—can be paid from the estate and reported on the next account.

Understanding the Problem

You’re asking whether, during a North Carolina probate, the estate can pay utilities, property taxes, and deed-related costs for real estate you co-own with your brother. The decision turns on whether the personal representative has authority to manage that real property during administration. Here, you and your brother are heirs and co-owners, so the question is how to lawfully authorize estate payments for these carrying costs and deed expenses.

Apply the Law

Under North Carolina law, real property usually passes to heirs at death, and the personal representative does not automatically control it. To use estate funds for real-property expenses, the personal representative must either have authority under the will (for example, property devised to the representative or an express power to manage/sell) or obtain a court order from the Clerk of Superior Court granting possession, custody, and control. With that authority, the representative may pay necessary charges to preserve the property and complete distribution, and must account for those payments.

Key Requirements

• Authority over the real property: The will must give the personal representative control, or the representative must secure a clerk’s order granting possession, custody, and control.
• Best interests of the estate: Payments must be reasonably necessary to preserve value or carry out administration (e.g., property taxes, essential utilities, insurance, deed prep/recording to distribute title).
• Heir involvement and notice: If seeking a court order for possession, heirs/devisees are parties and must be served; the clerk holds a hearing and issues an order if warranted.
• Accounting and approval: All disbursements must be documented and reported on the next estate account; the clerk may review reasonableness and allow necessary charges.
• Scope and limits: Without authority, paying ongoing “heir” expenses from estate funds risks disallowance. Authority should precede any non-urgent payments.

What the Statutes Say

• North Carolina Gen. Stat. § 28A-15-2 (Title vests at death) – Real property vests in heirs or devisees at death.
• North Carolina Gen. Stat. § 28A-13-3 (Powers of personal representative) – PR may seek possession of real property and pay taxes and expenses incident to assets under PR’s control; petition process for possession.
• North Carolina Gen. Stat. § 28A-23-3 (Commissions and necessary charges) – Clerk may allow reasonable sums for necessary charges and disbursements in managing the estate.
• North Carolina Gen. Stat. § 28A-17-11 (Order to lease or mortgage) – Clerk may authorize leasing or mortgaging real property if in the estate’s best interest.

Analysis

Apply the Rule to the Facts: Because you and your brother are heirs and co-owners, title to the properties vested in you at your father’s death. The personal representative must obtain a Clerk of Superior Court order granting possession, custody, and control (unless the will already grants it) before using estate funds for ongoing utilities and property taxes. Once authorized, the representative can pay necessary charges and the deed preparation/recording fees needed to transfer property to your daughter under the UTMA and include those costs on the estate account.

Process & Timing

1. Who files: Personal representative. Where: Clerk of Superior Court in the North Carolina county where the estate is administered. What: Verified petition for possession, custody, and control of specific real property stating why it is in the estate’s best interest (include property description and heir information). When: File as soon as you determine estate funds are needed to cover property costs.
2. The clerk issues summons to heirs/devisees and sets a hearing. After the hearing, if the clerk finds it benefits administration, the clerk enters an order authorizing possession, custody, and control of the property.
3. With authority in place, the PR pays necessary real-property expenses (e.g., taxes, essential utilities, insurance, deed prep/recording to complete distribution) from the estate account and reports them on the next annual or final account for clerk review.

Exceptions & Pitfalls

• Paying without authority: Using estate funds for ongoing carrying costs without will authority or a clerk’s order risks disallowance on audit.
• Heirs usually bear costs: Because title vests at death, heirs typically handle routine post-death carrying costs unless the PR is granted possession for estate purposes.
• Scope of payments: Limit payments to necessary charges that preserve value or complete administration (e.g., critical utilities to prevent damage, taxes, insurance, deed prep/recording to distribute); avoid optional improvements.
• Notice errors: In a petition for possession, all heirs/devisees must be properly served; defective service can delay or void the order.
• Rental income: Rents accruing entirely after death belong to heirs unless the PR has been granted possession; allocate correctly in the accounting.
• Written agreements: If heirs want the estate to advance or reimburse certain costs, obtain written consent and, when prudent, seek a confirming order before payment.

Conclusion

In North Carolina, the estate can pay property taxes, essential utilities, insurance, and deed fees for co-owned real estate only if the personal representative has authority over that property. If the will does not already grant it, the next step is to file a petition with the Clerk of Superior Court for an order giving the representative possession, custody, and control. After that order, the representative may pay necessary charges and report them on the estate account.

Talk to a Probate Attorney

If you’re dealing with how to authorize estate payments for utilities, taxes, and deed fees on co-owned real estate, our firm has experienced attorneys who can help you understand your options and timelines. 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.