What Happens to a Jointly Owned Property if One Owner Dies in New York?
Joint ownership of property is a common arrangement in New York, where two or more individuals share ownership of real estate. When one of these joint owners passes away, the distribution of the property depends on how the ownership is structured. Understanding the implications of different types of joint ownership is crucial for ensuring that your property is handled according to your wishes.
Types of Joint Ownership in New York
In New York, there are three main types of joint ownership for real estate:
- Joint Tenancy with Right of Survivorship (JTWROS):
- What it means: Each owner has an equal share of the property, and the right of survivorship means that if one owner dies, their share automatically passes to the surviving owner(s).
- After one owner dies: The property is not subject to probate, and the deceased owner’s share is distributed equally among the remaining owners. This means no one person can own a larger share than another, ensuring equality among the surviving owners.
- Tenancy in Common:
- What it means: Each owner may own an unequal share of the property, and there is no right of survivorship. Each owner can bequeath their share to heirs or other beneficiaries in a will.
- After one owner dies: The deceased owner’s share does not automatically transfer to the surviving owner(s). Instead, it becomes part of the deceased’s estate and is distributed according to their will or the state’s intestacy laws if there is no will.
- Tenancy by the Entirety:
- What it means: This is a form of joint ownership available only to married couples. Like JTWROS, it includes the right of survivorship.
- After one owner dies: The surviving spouse automatically inherits the deceased spouse’s share, and the property is not subject to probate.
The Impact of the Type of Ownership
The type of joint ownership significantly impacts what happens to the property when one owner dies:
- In JTWROS: The remaining owner(s) continue to own the property equally, without the need for probate. The deceased owner’s interest in the property is extinguished, and the surviving owner(s) maintain equal shares.
- In Tenancy in Common: The deceased owner’s share of the property will be distributed according to their will or intestate succession laws. The surviving owner(s) may find themselves co-owning the property with the deceased’s heirs, which could complicate property management or decisions about selling the property.
- In Tenancy by the Entirety: The surviving spouse gains full ownership of the property, which simplifies the transition and avoids probate.
Practical Considerations
For those holding property as joint tenants with right of survivorship or as tenants by the entirety, the transition upon the death of one owner is generally smooth and does not require probate. However, if the property is held as tenants in common, it’s important to have a will or estate plan in place to ensure that your share of the property is distributed according to your wishes.
It’s also worth noting that in the case of a joint tenancy, if one owner wishes to sever the joint tenancy (to turn it into a tenancy in common, for example), they can do so unilaterally in New York, potentially altering the way the property is handled upon death.
Conclusion
In New York, the distribution of jointly owned property after one owner’s death depends on the type of ownership. For properties held in joint tenancy with right of survivorship or as tenants by the entirety, the surviving owners automatically inherit the deceased’s share. However, in a tenancy in common, the deceased’s share becomes part of their estate and is distributed according to their will or state law.
Understanding these distinctions and planning accordingly can help ensure that your property is managed according to your wishes and can provide peace of mind for you and your co-owners.