Problems In Joint Tenancy, Right Of Survivorship And Community Property
Jones came to see me following the death of her husband because she wanted help on the distribution of his property. She had gone to her bank or investment company to withdraw one of her CDs (certificates of deposit) in the name of both her and her hubby. Although the account is at both their brands, it didn’t identify right of survivorship. That is the first problem with joint tenancy: The fact that the right of survivorship is present just because both names can be found on the document; the possession must show a right of survivorship actually. If you own real estate, you may be familiar with joint tenancy property.
That’s the benefit to what’s known as right of survivorship. It eliminates probate on the death of the first spouse. Listen closely; Revocable Living Trusts can treatment issues that are natural with joint tenancy of property, rights of survivorship, and community property. Although some social people use joint tenancy to avoid probate, the issues associated with wills and the probate process can meet up with them still. However, property in joint tenancy doesn’t avoid probate in both of these events: a common disaster in which both parties are killed or after the death of the next spouse.
In both instances, the possessions must proceed through probate. Only a revocable living trust bypasses the delays and costs of probate. Next, she presented three deeds to her residence. The first deed showed that she and her hubby had owned the house as joint tenants with right of survivorship. However, in 1981, they had transferred the house out of their brands to a third party and then back into their titles.
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Unfortunately, they moved the property as community property back. Mrs. Jones did not remember much about the transfer. She only knew that, in 1981, she and her husband became in an investment they thought might raise the size of their estate. To lessen capital gains taxes on another sale, their attorney had recommended they take their property out of joint tenancy and title it as community property. The couple hadn’t realized that community property doesn’t avoid probate.
The attorney must have suggested they use a revocable living trust. Currently, a new method to hold title is available: community property with right of survivorship. It’s uncomfortable to tell a widow that her recently deceased husband’s property now owned half of her residence. We had to probate this estate to transfer half of the residence to her, the only heir of the estate.
I was pleased for Mrs. Jones that her case got the shortest timeframe I’d experienced to complete a probate: only five and a half months. Mrs. Jones came back to see me following the probate process was completed. She was determined that, upon her death, all her assets could be distributed to her children and never have to go through probate.