Estate planning mistakes are often the result of failing to understand who has the legal right to inherit your property. In the case of real property, many people assume they have the right to leave their interest in the property to whomever they want, simply by making a will or living trust. However, the property owner can only bequeath or grant the rights he possesses. If you share an interest in property with someone else or another name is on the deed, it is important to understand how you hold title before leaving instructions about how you want your property to pass.
When you make an estate plan, how you hold title to property is one of the most important factors in determining whether your final wishes will be carried out. For example, suppose you purchase a house with your spouse or partner and take title as tenants in common rather than joint tenants. Upon your death, your spouse or partner may have to contend with the heirs who inherit your tenants in common share, rather than owning the entire property by right of survivorship.
Suppose you make a will leaving your share of the house you own with your new spouse to your children from a prior marriage. However, because you own the house with your new spouse as joint tenants, your children don't inherit anything because the surviving joint tenant owns the entire property. These types of estate planning mistakes are made every day and have devastating effects on surviving family members.
To ensure that upon your death your spouse, partner, child, parent or other beneficiary will inherit property according to your wishes, consult an attorney for help with estate planning. Review property deeds, titles, and account registrations to ensure any necessary changes are made to ensure your property is distributed in the manner you intend.
Methods of Holding Title
The following is a list of ways to hold title to property:
1. Community property
2. Community property with right of survivorship
3. Tenants by the entirety
4. Joint tenants
5. Tenants in common
Note: The above methods of holding title are not available in all states. To learn your options for holding title, consult an attorney licensed in the state where the property is located.
