There is no “right way” to plan an estate – but there are wrong ways. Plans could include wills, life estate deeds, trusts and joint tenancy, individually or in combination.
FORT LAUDERDALE, Fla. – Question: My daughter wants me to put my apartment into a joint tenancy with survivorship to make things easier when I eventually pass away. I want to make things easier, but I don’t know what this means. Is this safe and something I should do? – Laura
Answer: Planning for our eventual demise can save those we leave behind a lot of headaches. There is no “right” way to plan your estate; there is only the best way based on your situation.
You can use many tools, such as wills, life estate deeds, trusts, and joint tenancy, which, individually or in combination, might be the right choice for your circumstances.
The point of planning your estate is to ensure your assets and savings go your loved ones instead of creditors in a way that is simple and inexpensive for those you leave behind. This lets your family grieve your loss rather than dealing with creditors, lawyers and bankers.
A typical planning tool is to deed your loved ones onto your property with you. However, transferring an interest in your home can have significant consequences. Depending on how it is done, it can raise your property taxes, increase your liability, and create a situation where you need to ask your kids for permission to sell or mortgage your home.
That said, properly doing this can be a great planning tool to accomplish specific goals.
Your daughter is suggesting that you include her in the ownership of your home. Jointly owned property can be shared in three ways:
- The default type of joint ownership is known as “tenants in common.” Each owner owns their part of the property individually. The co-owners can each have the same shares, for example, each owning half, or they can agree to a different arrangement. When one owner dies, their share goes to their heirs, typically through the probate court.
- Property can also be owned as “joint tenants with right of survivorship.” With this type, each person owns the entire property without any division from the other owners. When one owner dies, the entire property remains with the other owners, and the deceased’s heirs inherit nothing.
- The final form of ownership, called “tenants by the entireties,” is similar to this but is reserved for spouses and offers additional advantages reserved for married couples.
Other options, like a life estate or lady bird deed, will allow you to maintain more control over the property while alive but still avoid probate when you pass.
The varied choices can make this all seem confusing, and to some extent, it is. An experienced estate planning attorney can help you sort through this and find the best solution for your family.
Property estate planning often proves the adage that “an ounce of prevention saves a pound of cure.”
Copyright © South Florida Sun Sentinel, Gary M. Singer. Distributed by Tribune Content Agency, LLC. All rights reserved.
