Joint Tenancy Rights of Survivorship

Joint Tenancy with Rights of Survivorship

If the decedent owned property as joint tenants with rights of survivorship, the survivor (or survivors) who also owns the property automatically inherits it. Individuals do not have to married couples to won property jointly with rights of survivorship. Submitting proof of death will place the title in the name of the survivor. For example:

In her will, Mary named all five of her children to receive all her property equally. Mary also named Robert, her middle child, to manage the estate. All of Mary’s property was in the form of checking, savings, and investment accounts. For all these accounts, Mary named Robert as a joint tenant with rights of survivorship. When Mary died, Robert inherited all the assets, and Mary’s other four children received nothing.

There can be other problems with joint tenancy with rights of survivorship. In this example, creditors of Robert’s might be able to garnish Mary’s accounts if they can show that a completed gift was made to Robert. This could also create a gift tax liability for Mary. If Robert had died before Mary, half of the joint accounts may have been included in Robert’s estate, subjecting his estate to potential estate taxes.

Tenants by Entirety for Married Couples

In some states, married couples may own property as tenants by the entirety. This is a special form of joint tenants with rights of survivorship only available to husband and wife. The survivor automatically inherits the property, and it is excluded from probate.

Community Property with Rights of Survivorship

An interest in community property that a person owns is included in probate unless the state permits community property with rights of survivorship. In such states individuals can title their community property with rights of survivorship. This allows the surviving owners to inherit the property with rights of survivorship. This allows the surviving owners to inherit the property outside the probate process. Individuals do not have to be married to own community property with rights of survivorship.

The information above is reprinted from Working with Seniors: Health, Financial and Social Issues with permission from Society of Certified Senior Advisors® . Copyright © 2009. All rights reserved. www.csa.us