Title Assets Properly to Protect Your Family

How you title your assets can have an impact on the way they are eventually transferred to your family, and, in some cases, it may not be the way you had intended. Assets such as houses and investments become part of your estate and their title will determine how they get distributed and how your estate may be taxed on them. The most common title used is “joint tenants with rights of survivorship” (JTWROS) which transfers assets immediately upon the death of one of the joint tenants without interruption to the surviving tenant.

In community property states, assets are assumed to be titled as community property unless another title is chosen. Community property automatically results in a 50-50 split of assets whereas specific asset divisions can be chosen with JTWROS. Also, it is important to be mindful that, assets that are transferred as community property may not receive a stepped-up basis for estate tax purposes.

It is always advisable to review your asset titling with a qualified attorney to ensure proper disposition and the most favorable taxation of your estate.