What You Need to Know About California Survivorship Deeds
Survivorship deeds are a common estate planning tool in California. Here’s everything you need to know about California survivorship deeds.
With a survivorship deed, when a co-owner of a property passes away, the property title transfers to the surviving co-owners without the need for probate, which can be a time-consuming and somewhat complicated process. This can make a survivorship deed an invaluable tool in estate planning, particularly if someone is contemplating the transfer of property to a spouse or children.
What is a Survivorship Deed?
A right of survivorship is a right given to one owner to inherit property after another owner’s death. As the definition implies, a right of survivorship requires at least two owners. If there is only one owner, then there is no other owner that can hold the right to acquire the property at that owner’s death. A right of survivorship also requires human owners. One cannot hold title with the right of survivorship if the other owner is an LLC or trust.
Because a survivorship deed is a document that allows a commercial or residential property owner (the grantor) to transfer the property to two or more property owners (grantees), this transfer creates a joint tenancy among the grantees.
Joint Tenancy with Survivorship Deed in California
A survivorship deed always involves a joint tenancy. However, it is important that the survivorship deed clearly contains wording that it is a joint tenancy with the right of survivorship. While two or more property owners can be owners in joint tenancy, it is the right of survivorship that permits the transfer of the property title from one joint tenant to the other in the event of death.
When two or more people hold property in joint tenancy with the right of survivorship, none of the joint tenants can leave the jointly held property to beneficiaries named in a will, nor can a joint tenant’s heirs inherit if that joint tenant dies in intestacy, or without a will.
Instead, where a joint tenancy with the right of survivorship exists, if one of the joint tenants dies, the property is divided equally among the remaining joint tenants without the property having to go through probate. This means that the surviving co-owners automatically get full legal title to the deceased’s portion of the property held in joint tenancy.
Related: Community Property Laws in California
How Does a Survivorship Deed Work in California?
A survivorship deed works as follows:
- The grantor(s) transfers property to grantees who own it as joint tenants
- Each grantee now owns an equal share in the property, but since these shares are not distinct, they cannot be transferred to anyone else (such as by sale or in a will)
- When one grantee passes away, their share is equally divided among the remaining grantees
- The last living grantee will own 100% of the property
What Forms of Co-Ownership Include Right of Survivorship?
Three types of deeds include a right of survivorship:
1. Joint Tenancy with Right of Survivorship. A joint tenancy with the right of survivorship is a common form of co-ownership in which each owner has a right of survivorship with respect to the other owners. On the death of an owner, the property passes automatically to the surviving owners. The last living owner inherits the entire property.
2. Tenancy by the Entirety. Tenancy by the entirety is a form of joint tenancy that applies only to married couples. On the death of one spouse, the property passes automatically to the surviving spouse. Tenancy by the entirety is recognized in many—but not all—U.S. states, but includes California.
3. Community Property with Right of Survivorship. Nine U.S. states, including California, treat a husband and wife as a single economic unit under a system of community property law. In California, spouses can hold the title as community property with the right of survivorship. This form of marital ownership allows the property to pass to the surviving spouse upon the death of the first spouse to die.
Related: Community Property Laws in California
How to Create a Right of Survivorship
A right of survivorship is created by specific language used in the deed. In the case of joint tenancy with the right of survivorship, the deed must list the owners and state that the property is held as joint tenants with the right of survivorship.
Similarly, a deed to a married couple as community property with the right of survivorship must state that the property is held as community property with the right of survivorship.
It is advisable to consult with an experienced estate attorney to help ensure the correct language is used in a deed to create a right of survivorship.
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