Joint tenancy is a way co-owners (joint tenants) can own property together. Under some circumstances, it is a useful probate avoidance tool, because all property held in joint tenancy carries with it the right of survivorship. This means that when one joint tenant dies, his/her ownership share of the joint tenancy property is automatically transferred to, and becomes owned by, the surviving joint tenant(s), without the need for probate.
The automatic right of a surviving joint tenant or tenants to inherit is basic to this form of ownership. One cannot leave an interest in joint tenancy property to anyone but the other joint tenant(s); if left to someone else by will or trust, the will or trust provision would have no effect. In almost all states, one can easily terminate a joint tenancy ownership while all other joint tenant owners are alive, changing ownership into a form of property called tenancy in common. You can then transfer or leave the client’s share to anyone.
Other forms of shared ownership, such as tenancy in common or c/p, do not create a right of survivorship and one person can leave their share to anyone by will, trust or instate succession. Any number of people can own property together in joint tenancy, but they must all own equal shares (except in Connecticut, Ohio and Vermont, where owners can provide otherwise in the deed). The owners share equally in all income, profits and losses from their property. If an ownership document specifies different percentages or shares of ownership, it is a tenancy in common, not a joint tenancy, and there is no right of survivorship for the co-owners. It is common for real estate to be owned in joint tenancy, but any type of property can be owned in this manner and avoid probate. Bank accounts, automobiles, boats and mobile homes are often held in joint tenancy for just this reason.
Many joint tenants, as well as married tenants by the entirety, are concerned about what will happen to their property if they die simultaneously. To deal with this highly unlikely possibility, the will can name a primary beneficiary to inherit the share of the property. If there is no primary beneficiary the property would still pass under the will, to the residuary beneficiary.
Some states restrict joint tenancy, but your client can still use it (or substitute):
Alaska—No joint tenancies are allowed for real estate, except for a husband and wife, who may own property as tenants by the entirety.
Oregon—A transfer of real estate to a husband and wife creates a tenancy by the entirety, not joint tenancy.
Tennessee—A transfer of real estate to a husband and wife creates a tenancy by the entirety, not joint tenancy.
Texas and Wisconsin—A joint tenancy can be created only if you sign a separate written agreement. If one attempts to create a joint tenancy, it will be treated as c/p with right of survivorship.