Co-ownership of Co-ownership of Real Property Real Property Tenancy by the Entirety Tenancy by the Entirety Joint Tenancy Joint Tenancy Tenancy in Common Tenancy in Common
Dec 29, 2015
Co-ownership of Real Co-ownership of Real PropertyProperty
Tenancy by the EntiretyTenancy by the Entirety
Joint TenancyJoint Tenancy
Tenancy in CommonTenancy in Common
Tenancy by the EntiretyTenancy by the Entirety
Held only by a husband and wife.Held only by a husband and wife.
Husband and wife are regarded as one.Husband and wife are regarded as one.
Surviving spouse owns the entire estate.Surviving spouse owns the entire estate.
Does not require probate.Does not require probate.
Divorce: tenancy by the entirety no longer Divorce: tenancy by the entirety no longer exists.exists.
Joint TenancyJoint Tenancy
2 or more persons own real property2 or more persons own real property
Single estate with multiple ownership.Single estate with multiple ownership.
Each tenant owns the entire estate.Each tenant owns the entire estate.
All joint tenants’ interests in the property All joint tenants’ interests in the property are equal.are equal.
Upon death, ownership does not pass to Upon death, ownership does not pass to the heirs or devisees of deceased tenant.the heirs or devisees of deceased tenant.
Does not require probate.Does not require probate.
Tenancy in CommonTenancy in Common
2 or more persons own real property2 or more persons own real property
Each person owns an undivided share.Each person owns an undivided share.
Upon cotenant’s death, share passes to Upon cotenant’s death, share passes to the heirs of the cotenant.the heirs of the cotenant.
No right of survivorship.No right of survivorship.
Probate required.Probate required.
Insurance PoliciesInsurance Policies
Named beneficiaries: primary and contingentNamed beneficiaries: primary and contingentUpon death, beneficiary receives the benefit Upon death, beneficiary receives the benefit without a need for probate.without a need for probate.Insurance company will require:Insurance company will require: 1) death certificate1) death certificate 2) completed claim form2) completed claim form 3) insurance policy3) insurance policy
If beneficiary(ies) is/are dead, policy must go If beneficiary(ies) is/are dead, policy must go through the estate.through the estate.
GiftsGifts
May avoid probate: May avoid probate: Gifts in Causa Mortis Gifts in Causa Mortis ( Gift in Contemplation of Death)( Gift in Contemplation of Death)
May avoid NJ Transfer Inheritance TaxesMay avoid NJ Transfer Inheritance Taxes
May avoid Federal Estate TaxesMay avoid Federal Estate Taxes
TrustTrust
May be created by an agreement or a Will.May be created by an agreement or a Will.
Subject matter is given to a third person Subject matter is given to a third person (trustee) for the benefit of the beneficiary.(trustee) for the benefit of the beneficiary.
Beneficiary is not the sole and absolute Beneficiary is not the sole and absolute owner.owner.
The ownership is divided into 2 parts:The ownership is divided into 2 parts: 1) trustee is the legal owner1) trustee is the legal owner 2) beneficiary is the beneficial owner2) beneficiary is the beneficial owner
Reasons to Establish a TrustReasons to Establish a Trust
1) mental/physical incapacitation1) mental/physical incapacitation2) beneficiary is a minor2) beneficiary is a minor3) subject matter3) subject matter4) save estate and/or income taxes4) save estate and/or income taxes
Creator of the trust determines how the Creator of the trust determines how the trust will be managed. (income & principal)trust will be managed. (income & principal)Probate may not be necessary.Probate may not be necessary.