People who own business assets with others can easily facilitate inheritance of their shares outside probate after death. As a business owner, you may consider titling your assets jointly depending on your state’s laws.
By definition, joint ownership refers to the possession of the same asset by more than one person. These assets not only include properties such as houses but also accounts, vehicles, business equipment and insurance among others. However, joint ownership differs with the type of business. Consider a visit to your “probate attorney near me 11518” to understand whether joint ownership can work for you.
If two or more individuals own an asset, joint tenancy guidelines will apply automatically in case one of the owners dies. The plan allows surviving owners to inherit the decedent’s portion of the assets instantly, without probate. This simply means that there is no need for the owners to prove through a will that needs to inherit the assets in the event of death.
Although there are several ways through which business assets can own assets together, joint business ownership is more common because it involves fewer processes when it comes to sharing assets after death.
Before implementing joint business ownership of your business, you need to understand the various options available. Of course, the ownership can only work if all the owners are listed on the title of the business asset. The various ways through which you can use joint ownership to avoid probate include:
- Joint tenancy but with survivorship rights
- Community property
- Tenancy by entirety
Joint tenancy with survivorship rights – this kind of joint business ownership allows business assets to be passed to other owners automatically after one of them passes away. It is ideal for businesses that own real estate, machinery, securities, vehicles, and financial accounts. Establishing a joint tenancy is very straightforward and does not cost any money. To set it up, both the owners need to sign an agreement with the relevant office.
After one business owner passes away, the surviving owners will be required to fill a certain form and bring it alongside the decedent’s death certificate to the right office.
Community property with survivorship rights – Married couples can jointly own business assets as a way of keeping these assets off the probate court. Upon the death of one partner, the surviving one automatically becomes the new owner of the jointly owned business assets. This is accomplished in a simple process where probate is not required.
Tenancy by entirety –this is slightly different from joint tenancy and only applies to married couples. The couples fill a certain form to subscribe to this arrangement. Any business assets owned in entirety gets automatically passed on to the surviving spouse after death. The process is straight forward and is carried out outside probate.