This vs That ⚡ Joint Tenancy with Right of Survivorship vs Joint Tenancy in Common

By TRG Advisors on June 3, 2021

Welcome back to This vs That – a comparison between common terminology, both related, yet different, and we’re here to break it down for you.

When two or more individuals own property, they can own it with Joint Tenancy. How the ownership is structured or titled is very important. The form of ownership of the property affects how property is transferred to someone else. So, if you own property with someone else, it is important to make sure you have the right form of ownership for your property.

Joint Tenancy with Right of Survivorship (JTWROS)

In this type of ownership structure, if one owner dies, the surviving owner then owns all of the property. The entire property ownership passes to the surviving owner, not to the heirs of the deceased owner.

Joint Tenancy in Common (JTIC)

If parties hold property as tenants in common, then each owner holds a percentage of interest in the property (they do not have to be equal). In the event of an owner’s death, the deceased owner’s heirs inherit their percentage interest in the property.  Thus, the heirs will then own the property together with the original co-owner.

Other Types of Joint Tenancy

Some states recognize tenancy by the entirety (TBE) as it applies to married couples. This treats the ownership of the property as though the couple is a separate entity from the two individuals, and both still wholly own the property. Thus, it is similar to JTWROS in that the parties have a right of survivorship. It can also offer some additional protection against creditors. When one party dies, the other party automatically takes title to all of the property. Note this is only valid if the couple remains married. Otherwise, ownership converts to tenants in common.

Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin recognize community property held between married couples. Alaska does as well under some circumstances. How the property will transfer upon the death of a spouse will be dictated by either the intestacy laws of their state or their estate documents if they have them.

If you currently own or are contemplating owning property jointly with others, it is critical that the ownership be structured correctly to avoid unintended consequences. Whichever method of ownership you select, it’s important to know the pros and cons of each. Reach out to us today to find out more information so that we can help you navigate what is best for your situation.

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