Ways to Hold Title

The manner in which you choose to take title may have significant legal and tax planning consequences. You should contact your attorney and/or tax consultant on which manner best suits your needs.

Community Property Joint Tenancy with Right of Survivorship Community Property with Right of Survivorship Tenancy in Common
Marriage Requirements Requires a valid marriage between two persons. Parties need not be married; may be more than two joint tenants. Requires a valid marriage between two persons. Parties need not be married; may be more than two tenants in common.
Spouse Interest Each spouse holds an undivided one-half interest in the estate. Each joint tenant holds an equal and undivided interest in the estate. Each spouse holds an undivided one-half interest in the estate. Each tenant in common holds an undivided and fractional interest in the estate. Can be disproportionate, i.e., 20% and 80%; 60% and 40%; 20%, 20%, 20%, and 40%; etc.
Partitioning One spouse cannot partition the property by selling his or her interest. One joint tenant can partition the property by selling his or her joint interest. One spouse cannot partition the property by selling his or her interest. Each tenant’s share can be conveyed, encumbered or devised to a third party.
Signatures Requires signatures of both spouses to convey or encumber. Requires signatures of all joint tenants to convey or encumber the whole. Requires signatures of both spouses to convey or encumber. Requires signatures of all tenants to convey or encumber the whole.
Inheritance Each spouse can devise (will) one-half of the community property. Estate passes to the surviving joint tenants outside of probate. Estate passes to the surviving spouse outside of probate. Upon death the tenant’s proportionate share passes to his or her heirs by will or intestacy.
Upon Death Upon death the estate of the decedent must be “cleared” through probate, affidavit, or adjudication. No court action required to “clear” title upon the death of joint tenant(s). No court action required to “clear” title upon the first death. Upon death the estate of the decedent must be “cleared” through probate, affidavit, or adjudication.
Community Property On Death Both halves of the community property are entitled to a “stepped up” tax basis as of the date of death. Deceased tenant’s share is entitled to a “stepped up” tax basis as of the date of death. Both halves of the community property are entitled to a “stepped up” tax. Each share has its own tax basis.