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 Ways of Holding Title

  TENANCY IN COMMON JOINT TENANCY COMMUNITY PROPERTY COMMUNITY PROPERTY WITH RIGHT OF SURVIVORSHIP
Who can take title? Any number of persons (can be husband and wife) Any number of persons (can be husband and wife) Only husband and wife Only husband and wife
How is ownership divided? Ownership can be divided into any number of interests, equal or unequal Ownership interests must be equal Ownership interests must be equal Ownership interests must be equal
Who holds the title? Each co-owner has a separate legal title to his undivided interest Title to entire property is jointly held by the joint tenants Title in the "community" (similar to title being in a partnership) Title in the "community" (similar to title being in a partnership)
Who has possession? Equal right of possession Equal right of possession Equal right of possession Equal right of possession
How do owners convey their interest? Each co-owner's interest may be conveyed separately by its owner Conveyance by one co-owner without the others breaks the joint tenancy, and owners then become tenants in common Both co-owners must join in conveyance of real property. Separate interests cannot be conveyed Both co-owners must join in conveyance of real property. Separate interests cannot be conveyed
Purchaser's status Purchaser becomes a tenant in common with the other co-owners Purchaser becomes a tenant in common with the other co-owners Purchaser can only acquire whole title of community: cannot acquire a part of it Purchaser can only acquire whole title of community: cannot acquire a part of it
What happens in case of death? On co-owner's death, his interest passes by will to his devisees* or heirs. No survivorship right On co-owner's death, his interest ends and cannot be willed. Survivor owns the property by survivorship On co-tenant's death, if decedent leaves a will, title goes to decedent's devisee.* If not, title goes to the survivor Decedent’s interest automatically passes to surviving spouse due to Right of Survivorship
What is the successor's status? Devisees or heirs become tenants in common Last survivor becomes sole owner If passing by will, tenancy in common between devisee and survivor results Surviving spouse becomes the sole owner
What is a creditor's interest? Co-owner's interest may be sold on execution sale to satisfy his creditor. Creditor becomes a tenant in common Co-owner's interest may be sold on execution sale to satisfy his creditor. Joint tenancy is broken. Creditor becomes tenant in common Co-owner's interest cannot be seized and sold separately. The whole property may be sold to satisfy debts of either husband or wife Co-owner's interest cannot be seized and sold separately. The whole property may be sold to satisfy debts of either husband or wife
What is the presumption of law? Favored in doubtful cases except husband and wife (see community property) Must be expressly stated and properly formed. Not favored Strong presumption that property acquired by husband and wife is community Strong presumption that property acquired by husband and wife is community
Is tax basis adjusted when first spouse dies? Only to extent of deceased spouse's interest Only as to half the property Yes – entire property receives "stepped up" basis Yes – entire property receives "stepped up" basis

* Note: a devisee is a person who receives real estate from another by will.

Ways to hold title

This is provided for general information only. The method of holding title (vesting) has certain significant legal and/or tax consequences and you are encouraged to obtain advice from an attorney and tax consultant or another qualified professional in this matter.