The concept of the right of survivorship can play a key role in your estate plan. People creating an estate plan in the Greensboro, North Carolina area will have to become familiar with a lot of legal concepts, and the right of survivorship is one such idea. While your attorney will explain in more detail what a right of survivorship is and how it can play a role in your estate planning decisions, we can look at the key points surrounding the issue so you can have a basic understanding.
Right of Survivorship
A right of survivorship, also called a joint tenancy with the right of survivorship, is a common form of property ownership most commonly associated with real estate. People who own property as joint tenants are co-owners of the same property. In joint tenancy with the right of survivorship, each co-tenant has an equal share of the property. Further, the final surviving co-tenant becomes the sole owner after the other co-tenants die.
For example, let’s say that you and your two siblings inherit your grandfather’s farm as joint-tenants with the right of survivorship. While more than one of you still lives, each co-tenant has an equal right to use the property. After two siblings die, the sole survivor becomes the sole owner of the property.
Survivorship and Probate
Rights of survivorship can play a role in inheritance planning because they allow property to avoid probate. Probate is the legal process that takes place after someone dies leaving behind property. Before new owners can take possession of that property as inheritances, the property must pass through the probate process.
Property owned by joint tenants with the right of survivorship, however, does not have to pass through probate. Upon the death of the other co-tenants, the surviving co-tenant becomes the sole owner of the entire property automatically. In this situation, the sole survivor does not have to wait to receive the property after the completion of the probate process because he or she is already an owner.
Survivorship and Inheritances
While rights of survivorship are an easy way to avoid probate, they aren’t ideal for every situation. For example, if you were a co-tenant of a property with the right of survivorship and have since become the sole owner, you can no longer pass the property outside of probate unless you take additional steps. Even if you decide to leave the property to two or more co-tenants with a right of survivorship, unless you take additional steps, that transfer will have to go through the probate process.