What Happens If Somebody Dies With Property But No Will?
It is a common assumption between spouses that at the death of the first spouse to die, the surviving spouse will inherit all the deceased’s property. This is usually not the case. If the individual or the deceased spouse has any children, whether from the first marriage or by the marriage to the surviving spouse, the property is not going to go entirely to the surviving spouse. Real estate, for example, would be any real estate that is not owned jointly with rights of survivorship between the two spouses and is not otherwise owned by an entity—like a trust or a closely held business. In that instance, one-half of the real property is going to go to the surviving spouse and the other one-half interest will go to the child(ren) of the deceased.
As far as the money that the surviving spouse would get, they could get the first $60,000 of the personal assets of the deceased. Usually, that means we’re transferring the family cars to the spouse or we’re transferring the personal property in the house, like furniture and household items. It could even be interest in a closely held business. This can get awkward when you have not only a surviving spouse trying to negotiate with the remaining owners of the closely held company, but also the children. You’re trying to negotiate a buyout of their interest as well.
Another way to avoid complete disinheritance of your surviving spouse is if the surviving spouse files an elective share of interest in the estate. That is a legal proceeding where a petition is filed with the court. It is determined by a clerk of the court, how much, if any, property a surviving spouse would get under that circumstance. It is based on the assets in the probate estate, but also all of the assets of the deceased. This would include not only individual assets but assets in
- Closely-held business interests, and
- Insurance policies.
This would also include trusts created by someone else over which the deceased spouse had a general power to appoint the property to anyone at their death. Anything in a trust that the decedent could revoke prior to death, or even at the moment of death, can be brought back into the pool of assets that are available to give a surviving spouse their elective share, or what’s been referred to as the fair share of the assets of the deceased spouse.
An elective share of interest is not a fixed amount, it is based on the length of the marriage. It’s graduated from basically zero up to 15 years. Once you’ve been married to someone for 15 years, then you inherit a larger portion, but not the entirety of the decedent’s estate. The shorter the marriage, the smaller amount the surviving spouse is entitled to receive.
The only way that you can really disinherit a spouse in North Carolina is through the adoption of a prenuptial agreement that specifically states that the individual spouse that survives renounces her right, in advance of the marriage, to any of the assets of the deceased spouse, including the right to qualify as executor of the estate. Also qualifiedly renouncing the right to an elective share or the $60,000 spousal allowance.
The question may arise in a folk’s mind why would anybody want to do that? I’ve seen it happen frequently, and for the most part, it is at the instance of a second marriage when the surviving spouse has adequate assets in his or her own name to be able to survive the death of the spouse. Another instance may be if one spouse is extremely wealthy and the other is of modest wealth. One may want to simply protect those assets from an equitable distribution requirement upon death.
For more information on Estate Planning Law in North Carolina, an initial consultation is your next best step. Get the information and legal answers you are seeking by calling (704) 248-6325 today.
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