Posted by: Coto Legal Services, PLC | March 21, 2011

Joint Property- Estate Planning Strategy

Although understandable, most people do not want to think about their death or the possibility that they may become disabled.  Nevertheless, most people are aware that they should have a plan for these events.   Therefore, a comprehensive estate plan is critical to protect you and your family.

Most people only start to consider estate planning when they have children.  They ask themselves who is going to take care of my children when I die or become disabled- and rightly so, but tragically some people just think about estate planning, never implementing the plan. However, just as tragic are people without children who never consider estate planning at all.   These people often believe that estate planning is only for individuals who have children.  Unfortunately, these people forget to ask the question- who is going to take care of them in the event they become disabled, and what happens to their property upon their death.   Simply put, all people need an estate plan.

A comprehensive estate plan is simply a set of legally enforceable instructions that ensure that you and your family’s physical, mental, and financial needs will be met when you are unable to make an informed decision about these matters.  Additionally, upon your death, your property will be distributed according to your own wishes, not by state law.

As we all know, a comprehensive estate plan tools includes health and financial power of attorneys, wills, and trusts.  Of course, only a licensed attorney who focuses on estate planning should be consulted to determine what specific estate planning tools you and your family require to effectively protect you and your family.

In this post, I wanted to address a common estate planning device that people use to distribute their property without going to probate court.  That is, establishing joint ownership of property.

Upon death the property is automatically transferred to the surviving co-owners by handing out death certificates to banks, stock brokers, and register of deeds.    However, this technique has the following potential disadvantages:

  • The individual must get the consent (signatures) of the joint owners if he or she wants to dispose of stock or real estate (in case of real estate,  must get the wives of mail joint owners)
  • Each joint owner of a bank account has the right to withdraw money from the account.  Therefore, all the money can be gone without your consent.
  • A creditor of one of the joint owner’s could claim these assets.
  • Jointly owned property passing to the surviving joint owner belongs solely to that owner, who cannot be forced to share it with other intended beneficiaries.
  • Joint property can be disadvantageous for people who need Medicaid.

Therefore, jointly owned property has potential significant disadvantages, which can be eliminated by using other estate planning strategies.

Please Contact Coto Legal Services, PLC for any questions regarding estate planning techniques and strategies.  Our firm will customize an estate plan that will meet your objectives and goals.   We welcome you to visit our website at cotolegal.com and e-mail us at rcoto@cotolegal.com

Information contained on this blog is not intended to be legal advice, and visiting this blog does not establish an attorney-client relationship.


Responses

  1. Interesting commentary on protecting yourself and your assets.


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