When creating your estate plan, you will need to consider how your property ownership fits in with your overall planning needs. If you’re looking to better understand how your assets will transfer after your death, take a look at the information below.
- Some Forms of Joint Ownership are NOT Controlled by Your Estate Planning Documents
Joint tenancy with right of survivorship – With this type of joint ownership, all owners have equal access to the assets. This means that any owner may take all of the assets without the consent of the other owners. Once you die, the surviving owners continue to have ownership over the assets.
Tenancy by the entirety – With this joint ownership, owners have complete access to the assets. Both owners are to take the assets without approval. In the terms of real estate, the property may not be sold without consent from the other owner. After you die, the co-owner continues to have ownership and full control over the assets. In many states, not including California, husband and wife own real estate in tenancy by the entireties.
Tenancy in common – With this form of joint ownership, each owner only holds a percentage of the property. He or she may only control that percentage. After death, the potion of property that an individual owned is passed on to chosen beneficiaries as designated in the owner’s will or trust. The other owners have no control over that portion of the asset.
Community property – With this form of joint ownership available in California persons who are legally married or registered domestic partners, each owner only holds a percentage of the property. Each spouse or domestic partner may only control that percentage. After death, the potion of property that an individual owned is passed on to chosen beneficiaries as designated in the owner’s will or trust. The other spouse/domestic partner has no control over that portion of the asset
- Title by Contract Assets Pass on to Chosen Beneficiaries
With beneficiary designation or contract assets, such as life insurance, annuities and many retirement plans (IRAs, 401k’s, etc.) the owner has full ownership and control during lifetime. The assets are then passed on to designated beneficiaries after death. Property that falls in this category also includes pay on death accounts and transfer on death accounts.
You’re able to decide how these assets are distributed after your death, and they’re not part of the probate process. However, reliance solely on beneficiary designations can have unintended consequences.
Where to Go With Questions
If you have any additional questions about property ownership, or if you’d like to analyze your estate plan needs, consult with an experienced and qualified estate planning attorney.