North Carolina Laws and Legal Materials

Welcome to OVLG's North Carolina laws and legal information center. Here, you can learn about state laws, legal information, and court information. Get links to state government websites and much more.

Debt consolidation & settlement

Debt consolidation is a debt relief option. It combines multiple debts into one manageable monthly payment. By can also enroll in a debt consolidation program. It can help you negotiate interest rates with your creditors and lower monthly payments.

A debt settlement program helps a consumer pay off the entire outstanding debt balance less than the original debt. By negotiating with the creditor a consumer can become debt-free faster and with bigger savings.

However, consumers must avoid debt relief scams. The consumers should:

Avoid debt relief scams

People should avoid scam companies, including out-of-state lawyers. Many of these debt relief companies charge high upfront fees, but they do nothing but make false promises. As per North Carolina federal law, charging upfront fees for debt settlement is illegal.

North Carolina's statute of limitations for debt is three years from the last account activity, one of the shortest in the nation. That is the time frame within which a debt collector may sue a debtor and recover the outstanding debt.

Additional legal resources for consumers

North Carolina bankruptcy laws

Federal bankruptcy laws help people and businesses with unpayable debts. Most of the 94 federal judicial districts file for bankruptcy in their respective bankruptcy court. As per law, no bankruptcy cases can be filed in state court.

Bankruptcy law helps people who can't pay off their debts. People can sell their assets to pay off creditors. They can also arrange a repayment plan. People need to follow US Code Chapter 7 and Chapter 13 (Bankruptcy Code) to proceed with bankruptcy.

If a business files for bankruptcy, then its assets are liquidated to pay off creditors. Businesses must follow Title 11 of the US Code (Bankruptcy Code) and proceed.

Chapters 7, 11, and 13 of the Bankruptcy Code are used for most cases. The main goals of the bankruptcy law are:

Provide the debtor a "fresh start" by eliminating most debts
Pay creditors in order if the debtor owns assets

Steps of a bankruptcy case:

A debtor files a petition to the bankruptcy court (Individuals, couples, companies, etc.)
A debtor must file statements of the assets, income, debts, creditors' names and addresses, and debt amounts.
The court clerk informs the creditors about the debtor's bankruptcy petition.
After the petition filing, debt collectors can’t make collection calls and harass the debtor. Creditors also cannot sue, garnish wages, or call for payment.
Some bankruptcy proceedings allow a debtor to reorganize and repay creditors, while others liquidate property.

Company formation in North Carolina

To form a North Carolina-based company, you must:

Register your company with the state
Produce internal corporate documents
Issue stocks and shares

How much does North Carolina company formation cost?

The North Carolina Secretary of State (SOS) charges $30 to reserve your business name (as of 2024).
To file your articles of incorporation, you must pay the SOS charges of $125.

Does North Carolina require a business license for a company?

You don't require any statewide general business license to start a company in North Carolina. However, you may need additional licenses, permissions, or registrations for your company based on your location and activities.

Your city, county, and state may also require a special permit or license based on your operation:

A standard business license
Seller's license
Professional license
Food or alcohol license

How do I Form a Company in North Carolina?

You should follow these steps to form a company:

Name Your Company - North Carolina company names must end with "Corporation," "Incorporated," "Company," or "Limited." (N.C. Gen. Stat. § 55D-20 (2024).)
Hire a Registered Agent - North Carolina companies must appoint a registered agent.
File Articles of Incorporation - Form a company in North Carolina by submitting Articles of Incorporation with the SOS. (N.C. Gen. Stat. § 55-2-02 (2024).)
Create Corporate Bylaws - North Carolina corporations must have Corporate Bylaws. Although required, you don't need to file this internal document with the state. (N.C. Gen. Stat. § 55-2-06 (2024).)
Select Directors and Initiate the First Board Meeting - In your articles of incorporation, the incorporator (the person who signs the articles) may name the corporation's initial directors.
Issue Corporate Stock - Your company may issue stocks to other persons. A person or organization that owns the stocks becomes a shareholder (or "stockholder") in your company.
Annual Report - Your company must file an annual report with the SOS. The deadline for filing is the 15th day of the fourth month after the fiscal year ends.
Get an EIN and Pay Taxes — companies need a federal Employer Identification Number (EIN). You may apply for your EIN on the IRS website. There is no filing fee.

How do I dissolve my North Carolina company?

In North Carolina, the board of directors may dissolve the company with the approval of shareholders. The company must liquidate its assets, pay off its debts, and distribute surplus assets to its shareholders. The SOS must receive Articles of Dissolution after approval. North Carolina charges $30 to file Articles of Dissolution in 2024. (N.C. Gen. Stat. §§ 55-14-01 and following (2024).)

You may contact a North Carolina business attorney and follow the suggested steps to dissolve your company lawfully.

Details of creating a North Carolina company

North Carolina wills and living trusts

How do North Carolina living trusts work?

A "living" trust (also known as an "inter vivos" trust) is a legal arrangement in which you can assign your assets while you are alive. After your death, your beneficiaries will receive the assets and wealth according to the trust laws.

How much does North Carolina trust formation cost?

In North Carolina, a simple Revocable Living Trust costs $1,000–$3,000. Complex trusts or attorney fees may increase costs.

Is a trust better than a will in North Carolina?

Trusts have more options for the grantor. Trusts can distribute your assets before or after your death. It also helps to avoid the expensive probate process. However, assets that are not included in the trust can be distributed by a Will.

Is a handwritten Will allowed in North Carolina?

A handwritten Will can be valid in North Carolina. To make it legally valid, you should write your own Will and sign it. Make sure it's totally written in your own handwriting.

Do North Carolina trusts require probate?

A living trust can help avoid probate in North Carolina. It can be used for almost any asset, such as real estate, bank accounts, vehicles, etc.

What is a Lady Bird deed in North Carolina?

A Lady Bird deed is also popular as an enhanced life estate deed. It is a legal document that helps you to give your North Carolina assets to beneficiaries after death.

What invalidates a Will in North Carolina?

In North Carolina, two competent witnesses must sign the Will along with the testator. If any parties violate state laws regarding Wills, the Will may be invalid.