If you are an older single American and you own your home you may be concerned about your home’s future if something were to happen to you. One option that people often consider is creating a joint tenancy with an adult child. When done properly, creating a joint tenancy with a child does offer a simple method for transferring ownership of the property in the event of your death. It also allows your child to control the property in the event of your incapacity.
Missouri law allows for the creation of more than one type of joint tenancy. Selecting the correct type of joint tenancy for your purpose is critical. In Missouri, unless the co-owners are husband and wife the law assumes that a tenancy in common was created absent language to the contrary. Property held as tenants in common gives each co-owner an equal interest in the property; however, upon the death of one co-owner the co-owner’s interest becomes part of his or her estate. The interest does not pass directly to the other co-owner.
To create a situation where your interest will pass directly to you adult child in the event of your death you need to create a joint tenancy with rights of survivorship, or JTWRS. When property is held as JTWRS and a co-owner dies, the co-owner’s interest in the property passes automatically to the other co-owner. Because Missouri law assumes that a tenancy in common was created absent specific language to the contrary, it is very important that you consult with your estate planning attorney to ensure that the language used in your deed will suffice to create a JTWRS.
If you create a JTWRS with you child it may also allow your child to manage and/or maintain the property in the event of your incapacity; however, it will not allow your child to sell the property, if necessary, while you are incapacitated. As long as you are still alive you retain your legal ownership interest in the property. There are, however, legal strategies that can be included in your estate plan that can provide your child with that authority in the event of your incapacity. Talk to your estate planning attorney about include an incapacity plan in your overall estate plan.
- How Will You Age in Place and Be Able to Die at Home? - August 16, 2020
- Beneficiary Designations and Other Non-Probate Transfers - August 15, 2020
- Leaving Assets Can Be Tricky – Part 3 - August 13, 2020