SB 121 — GSC Conveyances Between Spouses.

FILED SENATE GENERAL ASSEMBLY OF NORTH CAROLINA FebSESSION 21, 2025 S.B.S 1 SENATE BILL 121 Short Title:

121 SESSION 2025 PRINCIPAL CLERK S D SENATE BILL DRS35012-MVz-2 Short Title:

Rules and Operations of the Senate February 24, 2025 A BILL TO BE ENTITLED AN ACT TO PROVIDE FOR THE EFFECT THAT CONVEYANCES OF REAL PROPERTY BETWEEN SPOUSES HAVE ON CERTAIN MARITAL PROPERTY RIGHTS AND TO MAKE TECHNICAL CORRECTIONS, AS RECOMMENDED BY THE GENERAL STATUTES COMMISSION.

Election of surviving spousetotakelifeinterest in lieu ofintestateshareprovided.of intestateshareprovided.

*DRS35012-MVz-2**S121-v-1* General Assembly Of North Carolina Session 2025 (b) The surviving spouse may elect to take a life estate in the usual dwelling house occupied by the surviving spouse at the time of the death of the deceased spouse if the dwelling house was owned by the deceased spouse at the time of the deceased spouse's death, together with the outbuildings, improvements improvements, and easements thereunto belonging or appertaining, easements, and lands land upon which the dwelling house is situated and that is reasonably necessary to the its use and enjoyment thereof, as well as enjoyment.

(c) Theelection provided for in subsection(a)ofthissubsection(a) ofthis section shall beis madebymadebythefiling thefiling of a petition in accordance with Article 2 of Chapter 28A of the General Statutes (i) with the clerk of the superior court of the county in which the administration of the estate is pending or (ii) if no administration is pending, then with the clerk of the superior court of any county in which the administration of the estate could be commenced, together with the recording of a notice indicating the county and file number of the clerk's filing with the register of deeds in every county where real property to be claimed under the filing is located.

If the minor or incompetent spouse has no guardian, Page 2 DRS35012-MVz-2Senate Bill 121-First Edition General Assembly Of North Carolina Session 2025 thepetition maybeexecutedand filedbyfiledbya aguardianadlitemguardianad appointedbytheclerk.litemappointed bytheclerk.

(2) By a mortgage or deed of trust given by the deceased spouse to secure a loan, the proceeds of which were used to pay all or a portion of the purchase price of the encumbered real property, regardless of whether the secured partypartyis is the seller of the real property or a third-party lender, or by lender.

DRS35012-MVz-2Senate Bill 121-First Edition Page 3 General Assembly Of North Carolina Session 2025 (1) A right to an elective life estate under G.S.

(2) A right or claim to an equitable distribution with respect to the propertypropertyunder under G.S.

(2) The voluntary partition between the spouses executing a joint instrument conveying the property held as tenants bybythe theentiretyto entirety to themselves as tenants in common or in severalty.

Page 4 DRS35012-MVz-2Senate Bill 121-First Edition General Assembly Of North Carolina Session 2025 (6) A judgment of forfeiture ordering divestment of an interest in tenancy by the entirety pursuant to Chapter 75D of the General Statutes.

(a) Upon application of a party, the court shall determine what is the marital propertypropertyand and divisible property and shall provide for an equitable distribution of the marital property and divisible property between the parties in accordance with the provisions of this section.

(1b) "Maritalproperty"meansallMaritalproperty.–Allreal"Maritalproperty"meansall Maritalproperty.–Allreal andpersonalproperty acquired by either spouse or both spouses during the course of the marriage and before the date of the separation of the parties, and presently owned, except property determined to be separate property or divisible property in accordance with subdivision (2) or (4) of this subsection.

Marital property includes all vested and nonvested pension, retirement, and other pension and retirement rights and benefits, vested and nonvested deferred compensation rights, rights and benefits, and vested and nonvested militarymilitarypensions pensions eligible under the federal Uniformed Services Former Spouses Protection Act.

DRS35012-MVz-2Senate Bill 121-First Edition Page 5 General Assembly Of North Carolina Session 2025 (2) "Separate property" means all Separate property.

However, property property, other than real property, acquired by gift from the other spouse during the course of the marriage shall be is considered separate propertypropertyonly only if such an intention is this intent is expressly stated in the conveyance.

(8) AnyAnydirect direct contribution to an increase in value of separate property which that occurs during the course of the marriage.

The trial court may, however, in its discretion, consider whether or when such the tax Page 6 DRS35012-MVz-2Senate Bill 121-First Edition General Assembly Of North Carolina Session 2025 consequencesarereasonablylikelytooccurindeterminingtheequitablevalueconsequencesarereasonablylikelytooccurindeterminingthe equitablevalue deemed appropriate for this factor.

or to waste, neglect, devalue devalue, or convert the marital propertypropertyor or divisible property, or both, during the period after separation of the parties and before the time of distribution.

In anyanyaction action in which the presumption is rebutted, the court in lieu of in-kind distribution shall provide for a distributive award in order to achieve equity between the parties.

DRS35012-MVz-2Senate Bill 121-First Edition Page 7 General Assembly Of North Carolina Session 2025 (h) If either party claims that any real property is marital property or divisible property, that party may cause a notice of lis pendens to be recorded pursuant to Article 11 of Chapter 1 of the General Statutes.

Anysuch ordersenteredshall betakenintoconsiderationat trial and shall begivenbe given proper credit given.credit.

Page 8 DRS35012-MVz-2Senate Bill 121-First Edition