Some couples approach their estate planning lawyer seeking advice on creating a joint will. Generally, the estates lawyer will frown upon such a suggestion because in practice, joint wills are fraught with problems. A joint will can be created by a married couple and is a single will. A joint will is signed by the couple and in it contain provisions leaving all of their assets to each other. The reason why joint wills are not more commonly used as an instrument to bequeath gifts upon death is that usually, even in longtime marriages, most married couples do not have identical wishes regarding their assets.
Joint tenancy vs. tenancy in common
Married couples generally own real estate assets as joint tenants. A lesser form of home ownership is a tenancy in common. The key difference between the two is their effect on the distribution of assets at the death of one of the partners. Joint tenancies contain a right to survivorship. This means that at a partner’s death, their share of any joint assets become the sole property of the surviving partner by operation of law and outside any asset distribution of a will for example. In a will, assets held as a tenancy in common are distributed according to the terms of each person’s will. Tenancy in common may be a better ownership form where couples wish to gift or bequeath their assets or shares in an asset in different ways. This may be an attractive form of ownership for couples with children from a prior marriage particularly if the new spouse has no children of his or her own.
An example of how ownership forms may impact a will bequest or gift
A husband and wife initially owned their assets as joint tenants. The wife set out her wishes for the distribution of her assets upon her death in a will. Subsequent to executing her will, the wife was diagnosed with dementia and lost the capacity to alter or change her will. The husband believing his wife would treat his he’s him because of her medical condition severed the joint tenancy. A severed joint tenancy becomes a tenancy in common. Thus, the couple’s assets that were originally held in a joint tenancy became a tenancy in common. This change in ownership form ensured that the wife’s wishes would be followed according to her will before she became ill. In the event of the wife’s death, had the husband not severed or terminated the joint tenancy of the shared assets, the wife’s joint tenancy assets would have passed to her husband without considering the wishes or specific bequeaths in her will.
In this example discussed above, the husband, despite the wife’s illness, died before she did. Nonetheless, by severing the joint tenancy and holding assets as tenants in common, both the husband and wife’s wishes were followed upon each of their deaths. Before making any modifications to an existing will make sure you consult with an estate planning attorney to ensure your wishes are reflected in your will.