Joint Tenancy

Joint Tenancy - Overview

Joint tenancy is an agreement between owners that upon death, the owner's assets are passed onto the surviving owner. The owner that assumes the assets will own them outright and upon their death will become part of their estate. This transfer of asset's occurs immediately without delay of costs of probate. Joint tenants are not allowed to leave interests from their joint tenancy in their will, since all asset's related to the joint tenancy agreement will be assumed by the surviving owners.

Requirements for a Joint Tenancy

There are four requirements for classifying an agreement as a joint tenancy:

1. Each tenant must acquire ownership at the same time
2. Each tenant must acquire ownership in the same document
3. Each tenant must own the same type of interest and equal amounts of that interest
4. Each tenant must have equal and identical rights to possession

Benefits of Joint Tenancy

One of the largest benefits of joint tenancy is the ability to avoid probate court proceedings, since all of the assets are immediately transferred to the surviving owners.

Negatives of Joint Tenancy

Assets in a joint tenancy are not accessible to the family members of the deceased owner. This could leave surviving children with no claim to the assets. If the deceased owner has a significant debt, a creditor could attempt to regain control of the remaining assets related to the joint tenancy to recoup their costs.