The implications of joint tenant ownership

Many people, especially married couples, own real estate, securities and other assets as “co-owners with right of survivorship” (JTWROS). With this arrangement, if one of the co-owners dies, the other co-owner automatically inherits the property.

Advantages : Ownership owned by JTWROS avoids probate time and expense. This is a simple and inexpensive way to protect assets from the probate process. In addition, one co-owner can manage the asset if the other is unfit. Additionally, adding a younger person, such as an adult child, as a co-owner can make it easier to manage investments, write checks to pay bills, etc., especially if the older owner becomes unable to. manage your finances.

Disadvantages: Using JTWROS limits your flexibility. If you hold all of your assets with your spouse, they will all be inherited by your spouse. Nothing can pass to your other heirs, like your children, no matter what you say in your will. So, you should only use JTWROS for those assets that you absolutely want your co-owner to inherit.

Depending on the size of the estate, upon the death of the surviving spouse, significant taxes may be due that could have been avoided if the first spouse to die had left some property to their children.

If you decide to go this route, make sure a co-owner is someone you trust to properly manage your money in the event of a disability. One option is to appoint a co-owner only for a current account where modest amounts are kept, so that bills can be paid if necessary in the event of incapacity, but losses due to mismanagement would be minimized and there would be little loss. ‘impact on your plans for the distribution of your assets upon your death.

The IRS supplement – valuable, but little understood

Use a trust like a carrot for your beneficiaries

The conditions for acquiring federal pension benefits

FERS retirement package: FERS 2020 guide and TSP manual

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About Wanda G. Warren

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