One of the simplest forms of estate planning is titling property in the names of the owner and the beneficiaries. If titled correctly, this is a simple and cost effective way to avoid probate court. However, only if the deed is done correctly with proper language, will the property be kept out of the probate process. Here is a brief description of the different way to titling property, and how they are created.
Tenancy by the Entireties –
This type of title allows a married couple to hold property in both their names as one legal entity. Title in this fashion should read “John Doe and Jane Doe, husband and wife” or “John Doe, and Jane Doe, his wife”. Assets titled in this manner will stay out of the probate process at the death of one spouse, and pass entirely to the other spouse. Both spouses would have to agree to any transfer of the property. This type of title is only available to married couples.
Joint Tenants with Rights of Survivorship –
This type of title is created when the property is owned by two or more people, and it is specifically stated as such on the deed, for example “John Doe and John Smith, as joint tenants with full rights of survivorship.” When titling property this way, the property will stay out of the probate process at the death of one of the owners, and will pass entirely to the other individual. This type of title is commonly used when adding a child or heir to the property. It can also be used to gift a part, or half of a property to another individual.
Tenants in Common –
This type of title is the default presumption under Florida Law, when property is owned by more than one person who are not married. This type of title creates a one half interest for each owner, divided from each other. If one party passes away, the other party on title does not inherit the half they do not own. It would pass to the decedent’s heirs by will or intestacy law. If the deed does not have the language “as joint tenants with full rights of survivorship,” this is the title that is created, and can present complications later on.
If a client has a very simple estate, with one property and some bank accounts. Then, retitling the assets in this manner is the most efficient way to do so. However, clients must make sure to consult with an attorney. You should have an experienced estate planning attorney draft the title transfers to ensure everything is done correctly.