For most people, a home is the most valuable asset in their estate plan. While there are several techniques to keep a home safe from probate, joint tenancy is one of the most popular in California. However, joint tenancy is not without its downsides.
Joint Tenancy in California
A joint tenancy is a co-ownership of a real property where two or more people hold equal shares in assets such as:
After a joint tenancy arrangement has been established, each owner has rights to enjoy and use the property.
Joint tenancy is considered an easy way to get around probate because owners have “the right of survivorship.” This means, if one tenant dies, their share is passed to the surviving owners. If a surviving tenant wishes, they can also transfer their interest to another party such as a spouse, parent, or child.
Joint Tenancy Has Some Disadvantages
While joint tenancy offers an easy and affordable way to avoid probate, it has some disadvantages. They include:
Alternatives to Joint Tenancy
Joint tenancy works for some individuals, couples, and families. However, any small dispute could jeopardize your entire estate. You might be better off establishing a revocable living trust. Trusts have many benefits over tenancy agreements, including:
Just like joint tenancy arrangements, a revocable living trust lets your heirs keep your legacy safe from probate.
A strong and well-written revocable living trust has other benefits, too. You could take advantage of credit-bypasses and even save money on taxes while you are still alive.
Talk to an Estate Planning Attorney Today
A home is the biggest investment most people will ever make. Whether you own one house or an assortment of properties, you need a customized plan to ensure that you and your heirs get the most out of your legacy.
The Law Firm of Kavesh, Minor & Otis, Inc. has years of experience helping California residents protect their assets. Send us a message online today to schedule your initial consultation.