By Melissa Myers and Michael J. Tucker, June 2015 Issue.

Melissa Myers: Let’s talk jointly titled property. It’s a particularly important issue for gay and lesbian couples and there’s more to it now that some couples are getting legally married.

Michael J. Tucker: I’m seeing some assets titled in ways that clearly don’t reflect people’s intentions. Let’s start by clarifying what I mean when I use the term property.

Myers: Most people, when they hear the word property, associate that term with real estate.

Tucker: Lawyers, on the other hand, think of anything that can be privately owned as property.

Myers: So, anything from bank accounts and jewelry to boat trailers and timeshares all are considered property.

Tucker: So, jointly titled property encompasses anything owned by more than one person simultaneously. It could be a house owned jointly by two women, or a bank checking account co-owned by two men.

Myers:Lately I’ve seen accounts titled as joint tenants with right of survivorship, when it turns out that the couple doesn’t intend that result, and vice versa.

Tucker: Prior to same-sex marriage equality, some couples took title to property in joint name as a substitute for marriage, but that isn’t always the intention or the result. Some joint property is titled in a manner that provides automatic survivorship rights, and other joint property is not.

Myers: And, if the couple is married, they can choose to hold title as “community property with right of survivorship,” which can have income tax advantages for the spouse who lives longer.

Tucker: Folks can review how their jointly titled property is titled. Some may be “with right of survivorship,” often abbreviated WROS or ROS on financial account titles.

Myers:Some couples may have acquired an asset as joint tenants with right of survivorship. If the couple has since gotten married, they may decide to change that title to community property with right of survivorship.

Tucker: In any survivorship form of holding title, the surviving owner automatically inherits the deceased owner’s interest in that property.

Myers:Sometimes that’s what is intended.

Tucker: Automatic survivorship rights are often a significant convenience in the event of the death of one of the owners, presuming that the deceased owner intends to benefit the surviving owner.

Myers:What if joint owners do not want survivorship?

Tucker: Ownership in common without a survivorship feature is called “tenancy in common” and the co-owners are called “tenants-in-common.”

Myers:So, the interest of a deceased tenant-in-common doesn’t automatically pass to the surviving tenant-in-common.

Tucker: That property interest passes under the will of the deceased tenant-in-common, often as part of a probate proceeding.

Myers:What if the tenants-in-common have married each other in the meantime?

Tucker: Depending on circumstances, that tenancy-in-common property may be community property of the marriage.

Myers:What are the downsides of joint tenancy with right of survivorship?

Tucker: Income taxes can hit the survivor if the property has increased in value greatly, particularly if it is not a principal residence. So survivorship title is not always good. Also, joint tenancy with right of survivorship can be problematic for unmarried couples with high net worth, because of a quirk in the estate tax laws that applies only to unmarried joint tenants.

Myers:Is there another way to designate a partner as a joint tenant?

Tucker: These days, for real estate, an owner can designate a beneficiary in a beneficiary deed. The beneficiary has no ownership rights during the owner’s lifetime, but automatically succeeds to the owner’s interest at death.

Myers:Also, if the couple is married, each spouse could be regarded as having an undivided one-half community property interest in property if they didn’t take title as joint tenants with right of survivorship.

Tucker: Other disadvantages to joint ownership of property can arise if the co-owners can’t agree on their co-ownership of the property, and if they’re not married to each other, the legal remedy for that deadlock is called a “partition” lawsuit. A court gets involved to sell the property and divide the proceeds among the co-owners.

Myers:Remain aware of the legal and financial issues at stake when entering into co-ownership of property, even with loved ones. The set of legal issues is different if the couple is married.