how joint owned property works
as noted above a joint owned property may be held in legal forms such as joint tenancy this is when two or more people have equal rights and obligations to the property they rent or own together until one partner passes away at this time the owner s interest passes to the survivors without probate tenancy by the entirety another joint owned property option is when the parties are husband and wife in this case each spouse has an equal and undivided interest in the property if one spouse dies the full title of the property automatically passes to the surviving spouse two additional forms of jointly owned property community property and trust also have distinct features a spouse can acquire community property marital property during a marriage this property such as a rental unit legally belongs to both partners as of march 2021 u s states with community property laws included arizona california idaho louisiana nevada new mexico texas washington and wisconsin also guam and puerto rico have community property legislation and alaska s law is optional for tax purposes each spouse may claim half of the total income earned from community property finally in a living trust spouses may create a joint option in which both individuals are grantors and trustees they may place individually or joint owned assets in these trusts either person may revoke the trust during their lifetime choosing the best form of ownership for joint property can simplify things if one of the owners passes away joint tenancy is commonly used to avoid probate a lengthy costly and public process of distributing the deceased s assets in court risks of joint owned propertyjoint or jointly owned property does not come without its risks although later in life individuals often desire to add others names to the title of their property as a means of estate planning without attorney fees this can bring added risks of embezzlement for example if an elderly individual is in cognitive decline they might succumb to adding a friend or relation to a joint bank account the individual will then have full withdrawal rights in addition once an individual adds another s name to the title of a piece of property this act is typically final and cannot be undone however there are certain exceptions that can be pursued through the courts such as in the case of fraud or financial exploitation of those deemed to be legally incompetent 