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Tenants in Common and Joint ownership are two ways of owning property that couples have as an option. Many couples use the Joint Ownership option as a way to avoid probate.We can help you to figure out the most beneficial way to set up your assets so that the greatest possible share of your wealth goes to the people you want it to go to. Using the Joint option is very popular right now, but it may actually not be the best way for couples to set up their assets. There are some serious risks involved.
Tenants in Common
Tenants in Common is a very easy way to understand arranging property. For example, if you and your spouse both own your home in this fashion, you both own 50% of that home. If one of you dies, the half of the property that the decedent owned goes to the estate. It’s very straightforward.
Whatever portion of the property that each person owns under this arrangement can be willed to a survivor at their discretion. We can help you figure out the difficulties involved with this, as you may be willing a portion of your house to a survivor, for example, and that can involve a significant degree of complexity.
Joint Ownership
Under joint ownership, the last person alive owns the entire property. That last survivor can give the property to anyone they choose in their will, but only the last surviving owner can do so.
You can specify how much belongs to whom under this type of an arrangement. For the majority of married couples, this is the preferred arrangement. When one spouse dies, the other owns the entire property and can do with it as they see fit.
Sharing Assets
If a property is owned jointly, it is truly something that belongs to two people. This means that you do not have full control over the property anymore, and if there is a conflict at some point in the relationship, this can spell trouble.
This also means that, because the property does belong to someone else as well as you, it doesn’t automatically go to your estate and, therefore, may not end up being distributed as you wish. Rather than half of your home going to your child, for instance, it would go directly to your spouse under joint ownership and whether or not your child got any of it would be up to your spouse. The last person alive gets to decide how the property is handled, as was stated.
There are also complications involved with investments, taxes and other issues where joint ownership is concerned. These can make it much more complex to handle your estate after your death. Before you consider jumping on the bandwagon that joint ownership has become, talk to us about the matter. We can help you understand how tenants in common and joint ownership work and which would work best for your family and your plans.
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