Backbarrier saltmarshes are considered carbon sinks; however, barrier island transgression and the associated processes of erosion and overwash are typically not included in coastal carbon budgets. Here, we present a carbon‐budget model for transgressive barrier islands that includes a dynamic carbon‐storage term, driven by backbarrier‐marsh width, and a carbon‐export term, driven by ocean and backbarrier shoreline erosion. To examine the impacts of storms, human disturbances and the backbarrier setting of a transgressive barrier island on carbon budgets and reservoirs, the model was applied to sites at Core Banks and Onslow Beach, NC, USA. Results show that shoreline erosion and burial of backbarrier marsh from washover deposition and dredge‐spoil disposal temporarily transitioned each site into a net exporter (source) of carbon. The magnitude of the carbon reservoir was linked to the backbarrier setting of an island. Carbon reservoirs of study sites separated from the mainland by only backbarrier marsh (no lagoon) decreased for over a decade because carbon storage could not keep pace with erosion. With progressive narrowing of the backbarrier marsh, these barriers will begin to function more persistently as carbon sources until the reservoir is depleted at the point where the barrier welds with the mainland. Undeveloped barrier islands with wide lagoons are carbon sources briefly during erosive periods; however, at century time scales are net carbon importers (sinks) because new marsh habitat can form during barrier rollover. Human development on backbarrier saltmarsh serves to reduce the carbon storage capacity and can hasten the transition of an island from a sink to a source.