It’s important to carefully consider each estate planning decision that you make, including the use of joint tenancy. While can be beneficial to own property in joint tenancy with another individual, there are also some disadvantages to this form of ownership. It’s important to carefully consider both the advantages and disadvantages before including joint tenancy in your planning. The benefit is generally probate avoidance and, in some states, asset protection for married couples. More disadvantages are described below.
There is a certain level of uncertainty. Unfortunately, you’re unable to look into the future and see how your assets will be handled or how your affairs will change. When agreeing to jointly own property, you’re agreeing to a certain level of uncertainty. While your affairs may be handled as you wish, there also may be some unexpected results.
Loved ones may be disinherited. If you choose to jointly own property with another individual, he or she chooses how the affairs are handled after your death. For example, if you choose to name one of your children as co-owner of a jointly owned bank account, he or she may choose not to share the assets with his or her siblings after your death. This is quite common.
The property may still be subject to the probate process.If both owners die at the same time, the property will be left to go through the probate process. Alternatively, if one person dies, the other owner will have full control until he or she dies. This property will then go through the probate process. This means that probate is only avoided for a certain time period.
If you have any additional questions, or if you’d like to discuss how joint tenancy fits in with your estate plan, consult with a qualified estate planning attorney.