Pros & Cons of Joint Tenancy

/ August 11, 2015

house - iStockA comprehensive estate plan deals with multiple types of property; from probate assets that pass through your will, to non-probate assets that pass outside a will via a trust or beneficiary designation, to jointly held assets, which pass automatically at the time of the first death. One of the most common joint assets people hold is their home, which is most commonly held in “joint tenancy with right of survivorship.”

When an asset is held by joint tenants, it automatically passes to the survivor on the first death. In order to formalize the transfer, each county may have the survivor file simple paperwork. Because it is such a simple process, joint tenancy can be a useful tool to pass an asset outside of probate at the first death, and can even be used to reduce the estate to the point where probate is avoided altogether, if that is a goal in the estate plan. However, there are both pros and cons to joint tenancy that need to be considered when weighing its place in an estate plan.


It is easy and comparatively quick for the survivor to transfer title into their sole name after one owner dies.

It works for most assets: cars, real estate, bank accounts, investment accounts, etc.

After the first death, the asset is not subject to creditors’ claims that were the sole responsibility of the deceased party, only claims that were the joint responsibility of both tenants.

You are not limited to 2 joint tenants- you can list groups of any size, with full ownership rights passing to the longest living.


During the lifetime of the joint tenants, the creditors of a joint tenant can make claims against and seek payment from all of the jointly held assets.

The last joint tenant will still need a will or trust to pass the asset to their beneficiaries.

Although it’s unlikely that all owners will die simultaneously, in that situation, joint tenancy would not help avoid a probate.

The joint tenants must own equal shares, but each tenant also has the right to enjoy the whole property (including removing all assets from an account), which can leave one joint tenant open to the other taking more than is expected.

If the property is currently held by a single owner, creating the joint tenancy can result in a taxable gift to any added joint tenants.

You need the consent of all owners to transfer the property- this can be difficult to obtain if incapacity or disagreement are likely.

Changing your will does not change the ownership of the property, and you are not guaranteed your interest will pass on to your heirs (unless you are the last to die, or they are shared among the joint tenants).

Joint tenancy can be a very useful tool to speed up the distribution of assets after a death. For a person with a smaller estate, it may even help avoid the need for a probate. However, the drawbacks can be significant, and their application to each estate is best discussed with an estate planning attorney who understands the individual situation.