People ask this question often of us and our answer always is, probably not. Joint tenancy is the most common estate planning device, whether exercised consciously or unconsciously. However, for most people, it is not a good arrangement for the following reasons:
- You must get the consent of the other joint tenant(s) to refinance or sell a property.
- If the other joint tenant gets sued, you can lose your asset.
- While joint tenancy avoids probate on the first death, probate will probably be required upon the second death.
- Joint tenancy assets are subject to the lengthy and expensive processes of conservatorship and guardianship in the event of a disability of a joint tenant.
- Assets held in joint tenancy do not get a full step-up in cost basis upon the first death, resulting in potential capital gains taxes upon the later sale of the assets.
The ideal plan is to hold assets within a living trust. Married couples would hold assets as community property within the trust.
At Morris Hall, we have focused our legal practice on estate planning for over 50 years. Along with estate planning, our attorneys help clients and their families with matters of probate, trust administration, wills, powers of attorney, business planning, succession planning, legacy planning, charitable gifting, and other important legal aspects...Read More!
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