“Joint tenancy” and “tenancy in common” are property ownership arrangements used when a property has two or more owners. In cases of joint ownership of a property, it will be established whether the multiple owners will hold the property as tenants in common or as joint tenants. The biggest difference between these two forms of joint ownership comes into play when one of the owners passes away.
Joint tenancy: Joint tenancy refers to the right of survivorship. Under these arrangements, following the death of one of the “tenants,” a.k.a., owners, the deceased owner’s share will be transferred to the surviving tenants. This will happen independently of anything referenced in the deceased tenant’s will and it will not be subject to approval by a probate court. The ownership transfer of a joint tenancy happens automatically upon death.
Tenancy in common: Tenancy in common refers to the shared ownership of a piece of property by two individuals, and there is no right of survivorship involved in these arrangements. As such, following the death of one of the tenants, the deceased tenant’s share of the property will pass on to the heirs he or she names in a will. As such, the ownership rights of a tenancy in common asset must go through the probate process before ownership rights will be disbursed to the beneficiary.
If you own a property and plan to set up a tenancy in common or joint tenancy, make sure you understand the above-described differences from an estate planning and inheritance perspective before you agree to one of these property ownership arrangements.
Source: FindLaw, “Transferring property,” accessed May 18, 2018