Stautz Law

Tag: Joint Tenancy

  • To Do List for New Parents

    Video

    Editorial Comment

    This talk contains a LOT of references to estate planning concepts that you may or may not be familiar with. In order to keep it to a reasonable length, I didn’t explain every concept I mention. In the transcript below, I’ve tried to link out to my other resources on each topic. So you should be able to follow along and click through wherever you need more context!

    Enjoy!  

    Transcript

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    Hi folks, it’s Andy Stautz at Stautz. I’m back for a follow-up talk about an Indiana estate planning topic. So just before this, I recorded a talk on why new parents need a will. So you should watch that or read it. This follow up is more of a to do list. Like OK, what all is on your plate here in terms of estate planning?  

    Item #1: Get a Will

    OK so, you know, “get a will” is a pretty easy piece of instruction: either call an estate planning attorney or go to one of the do-it-yourself things and do it yourself. (At your own risks there.)  

    Item #2: Get your ancillary documents: POA, Healthcare, etc.

    Also, though, there are some other related things, so #2: think about your ancillary documents. So not the will itself, but you know, financial power of attorney, a healthcare advance directive, right? It makes sense to think about all of it at once and as one package. I’ve talked about those documents elsewhere. I’m not going to go through what they do right now.  

    Item #3: Talk About Your Values

    That’s one thing: to do a values conversation, right? When you’re doing planning, you need to talk to your spouse. And your children. I mean, obviously we’re talking about a situation where you’ve got a baby, so maybe not there, but you know, talk to your spouse. What do we want it to look like? You know, what are we worried about? What can we prevent? What are our values? End of life decisions. Worst case scenario decisions: who raises our kid if we’re gone decisions? You know. Make it a date night. Mom can drink again so you know, open a bottle of wine and sit down and talk about it. It will be good.  

    Item #4: Check Beneficiary Designations

    Other non-will, non-probate non-”other documents.” But just like getting your property affairs in order. So a big one is beneficiary designations on your retirement accounts. For a lot of young couples I know, for us, right, our brokerage account, you know 401(k), IRA, that’s the biggest single piece of property we’ve got. And if you’ve got a beneficiary designation, it’s not a probate asset. It’s not controlled by your will.

    So log on to your portal, your vanguard, your fidelity, whatever, and make sure it’s correct. Because some of those providers automatically, like, cancel your old designations if you get married or if you have a kid, but not all of them do so, so go check. Make sure it’s who you want it to be. You know, probably spouse as your primary, and then your backup might be, I don’t know, your parents, if they’re still living. You know, you can do it to a trust if you’re doing sophisticated planning, but we’re just talking like basics. Make sure it’s correct. Same thing with life insurance. If you carry life insurance.  

    Item #5: Figure Out How Your Assets are Titled

    And then the other thing would be, relatedly, organizing title. Make sure you know how you own things, so if you if one of you owned a house before you got married, you know, are you both on the mortgage? Are you both on the deed? What about your cars? Same thing. Because anything you own jointly with your spouse also avoids probate and just goes to your spouse. So you might want that, you might not want that. I’ve talked in other videos about how joint tenancies work and what they might do or not do.  

    How Much Work Is This?

    But just kind of, in my mind, when I tell new parents “get a will, you need a will,” it’s not just, you know, your three page document with your signature on it. It should be a good reminder to kind of, like, get everything in order, right? Just sit down and do it. Really. It might only take a few hours. Honestly like 2 hours maybe. Call an attorney. Hey, when do you have a consultation? next week? you go to that. That’s… call that one hour. And then you go home and you do your homework. And you fix all your beneficiary designations and you make a binder. Let’s call that another hour, and then you come back and then you sign the will and your documents. Right, like two hours, 2 1/2 hours.  

    And it will save you tons and tons of time and money and stress. UM. Whether or not you “need it,” right? It’s being able to sleep. It’s knowing. OK, my kids are fine. I’ve done what I can do to make that easy for them.  

    Conclusion: You’ll Feel Better, I Promise

    So that that’s kind of your list, you know, get the main documents, get the ancillary documents, fix your beneficiary designations, make sure you know how things are titled, and talk about it with your spouse and with, you know, if you’re designating a guardian like. Hey, would you raise my kids, if I’m gone, that kind of thing.  

    So do those things. It’ll feel good and you know, people are relieved to get it done and it’s the responsible thing to do so. Hope that makes it easier to kind of see. OK, that’s what you’re dealing with. That’s how long it will take. Don’t put it off. Alright, give me a call if you need help with any of that. I hope that was helpful. Bye for now.

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  • Joint Tenancies Part III: Planning Considerations

    Video

    Transcript

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    Hi folks, it’s Andy Stautz with Stautz Law. We are back at part three of our three-part series on joint tenancies. So on the first one, we talked about what joint tenancies are. Our second video talked about survivorship affidavits and making sure you clear up joint tenancies when they’re over. This one, which I’m recording hard on the heels of the other ones, is about, like, What are we doing? What are some considerations you know? Should we plan using joint tenancies?  

    Joint Tenancies and Married Couples

    So I think the thing to remember is when a married couple buys property in Indiana there’s a presumption that they buy it jointly as tenants by the entirety. The type of joint tenancy. It’s reserved for married couples, but that’s like … that’s the default. That’s what you’re getting.  

    That works well for a lot of people because a lot of people’s estate plan is, you know, “all to my wife, then to my kids,” “all to my husband, then to my kids.” So. It’s a guess. It’s a good guess by the state of Indiana about how you want property with your spouse to work. It doesn’t mean it’s right in every situation.  

    Also, ordinary joint tenancies you can create with anyone. … You don’t have to be married.  

    Caution: Right of Survivorship Works Even If You Don’t Like It

    I think you need to be really careful when you’re using joint tenancies in planning, because they’re so slippery. I mean, I mean, sometimes they work when you don’t want them to. Because the right of survivorship applies to whoever survives.  

    You know? it’s not like, ohh, we’ll stop and think about it and decide. Right. And if you’ve got a right of survivorship, you don’t get to pass the property by will or, you know, in a trust, a testamentary trust, a pour-over will, none of that. So it it’s like. ZAP. It happens. It’s a shortcut against the rest of your estate plan.  

    Joint Tenancies as Cheap Estate Plan

    And if you want quick and dirty, you know, great. It does that. It’s cheap. You don’t need to do anything.  

    But if your circumstances change over time, it’s risky because it’s just kind of sitting out there.  

    How a right of survivorship goes wrong

    So I used an example in a previous video of someone who remarried and you know the new wife is …. is on the on the deed to the property and the old will says, oh, the property goes to my son. Well, that will has nothing to give anymore because when the husband dies, the new wife gets it, and the the son by the prior marriage doesn’t. And that’s almost certainly not what the man had in mind . . . you know, who knows, but . . . .  

    So they’re squirrelly. You know, they just…. If you’re not on top of how you own the property, you might not like what’s going to happen. So that’s probably the main reason.  

    Behavior Problems with Joint Tenants

    The other reason is you know you and your joint tenants have to get along. There aren’t separately descendible shares. That’s why you can’t give it away by will. Uh. So you might… you and your joint tenants’ estate plans have to line up to that extent. The only way to undo it is you know, you agree to sell or you go to a court and you have a partition action. It gets messy.  

    Conclusion: You Need a Complete Plan

    So tenancies by the entireties for married couples, usually good; joint tenants with other people, behaviorally risky. Either way you need estate planning strategy built around it, so don’t just assume that what you’ve got is going to is going to work.  

    Happy to talk about this topic or any other with you because I love solving estate planning puzzles, so I hope to work with you on your plan. Give me a call. We’ll talk more about it, but that’s all for today. Bye now. 

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  • Affidavits of Survivorship (Joint Tenancies Part II)

    Video

    Transcript

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    Introduction

    Hi folks, it’s Andy Stautz at Stautz Law and we are back with a follow up hard on the heels of our last discussion.  

    We just talked about joint tenancies–joint tenancies are where two or more people own a property all together: not in separate shares, but together.  

    And now I’m talking about survivorship affidavits 

    How Survivorship Works for Indiana Joint Tenancies

    As we discussed in our last video with the joint tenancy, if one of the joint tenants dies, the other owners step up; they get the property automatically. There’s no need for probate. There’s none of this other stuff.  

    How an affidavit of survivorship works

    The only thing you need is a little one page doc called an affidavit of survivorship, and I’ve got a sample copy. There are tons of sample copies on the Internet. Marion County, Indiana, if you’re doing Indiana estate planning, you know, we’ve got examples.  

    I’ll link one in the text version of the post. [As promised: here’s a link to Marion County’s sample affidavit of survivorship. Courtesy of Indianapolis government!]  

    It’s a one-pager and it basically says. You know, my name is such and such. I owned this property jointly with whomever. That person died. The property is mine now. Boom.

    Do you need to record the affidavit of survivorship?

    And that gets recorded. Just like a sale deed. Except it’s not a sale. It just it says “OK, County recorder, this property that was a joint tenant is now just mine or is now just we remaining owners”. 

    And you’ve got to do this. You’ve got to do this because what the affidavit of survivorship does is changes the title, the title of record. From both of you or all three, you know however many: from both of you to just one of you–to just your name.  

    And that lets you sell the property or dispose of it in your will or you know basically clears up the title and clarifies the fact that it used to be a joint tenancy, now it’s yours.  

    Why do I need to retitle joint property after death?

    If you don’t do that, bad things can happen. Or unexpected things. So I had a probate consultation with a man who . . . had a will that gave him a house. But the person who wrote that will owned the house in question as a joint tenant with right of survivorship. With someone else. So the will, you know… it wasn’t… the first of the joint tenants to die doesn’t get to give away the property. It goes to the survivor. So that really messed up the estate plan there.  

    And that’s why you should always make sure you know keep up on your property titling. So anyway, don’t be scared of the affidavit of survivorship. It’s an easy document to make. I can help you with that. You want to do it right. So there are DIY forms, but… I think you should call me.  

    Anyway, if you need help with that or any other estate planning, Andy Stautz at Stautz Law; you’re on my website so you know all of my contact information. I’m going to do one more video on this topic. And it’s going to be you know, pitfalls, traps, considerations, whether planning with joint tenancies is actually a good idea or not. So stay tuned. Bye for now. 

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  • Joint Tenancies Part I: The Basics

    Video

    Transcript

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    Hi folks, it’s Andy Stautz at Stautz Law. I’m back for another quick talk about basic estate planning topics. Today’s topic is joint tenancies.  

    Joint tenancies are a type of real property ownership. It’s kind of one of the ways you can own property. So you can own property just as yourself as a natural person, right? A corporation or an LLC can own property.  

    You can also own property with other people. You know, two people on the same deed for a parcel of land or a house. And it’s really, really common. The most common situation is when a husband and wife own a house together. That’s a type of joint tenancy.  

    It’s actually a special kind of joint tenancy called tenants by the entirety. But you don’t have to be married. 

    You can be a joint tenant basically by deciding to title real property into your name and the name of your co-owner. So the interesting thing about joint tenancy is you and your co-owner (or co-owners if there’s more than one) really share the property. It’s not like one of you has half of it and the other you of you has half of it. When you’ve got separate shares like that it’s called tenants in common, and that’s different.  

    So joint tenancy: all of the joint tenants, all of the multiple owners, you know, get to use the property. The property is theirs, but they can’t separately, sell or deal with some portion of the property’s value.  

    The interesting feature for estate planning purposes is that most joint tenancies–the overwhelming majority–have what’s called a right of survivorship. And tenants by the entirety with married couples also has this right by survivorship.  

    And that means if one of the owners dies, the remaining owners would get it automatically. I mean the owner who dies, you know, goes away. And it’s automatically… the property remains with the other owner or owners. So there’s no, there’s no probate process, there’s no uh, you know, re-deeding anything. The only thing you need to do that is what’s called an affidavit of survivorship, and that is the topic of my next video. 

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