2/20 Titling

Overview of Property Titling and Estate Planning

• Understanding property titling is essential in estate planning as it dictates how property is transferred upon death.

• Discussions included wills, trusts, estate plans, and probate court.

Key Concepts of Property Titling

Importance of State-Specific Laws

• Each state has unique laws regarding property titling and transfer.

• Common law properties have specific rules depending on the state.

• Assets and income acquired in a common law state may give someone a statutory claim to property even if they move out of that state.

Impact of Marriage on Property Ownership

• Marriages impact property transfer laws which vary by state.

• Some states legally require assets to be passed to the spouse, affecting wills and beneficiary designations.

• Example: In Colorado, one may need a spouse to sign a waiver to designate a beneficiary other than a spouse.

Types of Property

Definition of Property

• Real Property: Physical property such as homes, apartments, and farmland.

• Intangible Property: Rights to things like music, mineral rights, or other non-physical assets.

• Digital Assets: Emerging category covering cryptocurrencies and digital ownership.

Types of Ownership

Sole Ownership

• Defined as property owned by one individual.

• Owner has complete control - ability to sell, gift, or bequeath property as desired.

Tenancy in Common

• Multiple owners possess a defined percentage of property; ownership is not equal.

• An individual's share can be passed on to heirs upon death as per will designation.

Joint Tenancy with Rights of Survivorship

• Owners have equal rights; property transfer occurs automatically to remaining owners upon death.

Tenancy by the Entirety

• Specific to married couples; requires spousal consent for any sale or transfer.

• Automatically transfers to the surviving spouse upon death.

Community Property States

• In community property states, assets acquired during marriage are owned 50/50 by both spouses regardless of whose income paid for it.

• Inheritance is typically excluded from community property.

Legal Considerations in Estate Planning

Commingling Assets

• Mixing inherited assets with marital assets can complicate future claims and the distribution of estate upon death or divorce.

Key Man Insurance

• This insurance can be structured to buy out a deceased owner’s share, ensuring control stays with the original owners.

The Role of Probate Court

• If property is challenged in probate court, the ruling can be influenced by the wording of wills and state laws.

• Courts have discretion to decide on asset distribution, which can differ from the intended wishes of the deceased.

Conclusion and Recommendations

• Proper titling and beneficiary designations are crucial to prevent unwanted probate disputes.

• Consult estate planning attorneys familiar with local laws to ensure wills and trusts are valid and reviewed when moving between states.