Avoid Surprises: How to Handle Shared Property in Your Estate Plan

“Success in real estate starts when you believe you are worthy of it"
- Michael Ferrara

Introduction

When it comes to estate planning, most people think about their home, their bank accounts, or their family heirlooms. But what about property that you own with someone else, like a vacation home, a rental, or even the house you and your sibling inherited from your parents?

Shared property is one of the most overlooked parts of estate planning. If it is not considered properly, it can create headaches, disputes, and even unintended outcomes for families.

Why Shared Property Gets Complicated

How your property is titled matters more than most people realize.

• Joint Tenancy with Right of Survivorship (JTWROS): If one owner passes away, the survivor automatically owns 100 percent. That might seem simple, but it also means children or other heirs may receive nothing.

• Tenants in Common: Each owner holds a separate share. That share can be left to heirs through a will or trust.

Many families do not know which one they have until it is too late.

An Everyday Example

Imagine two brothers own a rental property together. It is titled “joint tenants with right of survivorship.” One brother passes away, expecting his child to inherit his share. Instead, the surviving brother automatically becomes the full owner. The child receives nothing, not because that is what Dad wanted, but because of how the deed was written.

This type of situation happens more often than you might think.

Common Options for Shared Property

The good news is that there are ways to structure shared property so that it fits into an overall plan. Here are a few approaches that families often use:

1. Revocable Living Trust (RLT)

• If the property is held as tenants in common, an owner can place their share into their trust.

• The trust then controls what happens to that share.

• This approach is straightforward and helps avoid probate for that portion.

2. Joint Property Trust

• Both co-owners transfer the property into one shared trust.

• Each person’s share flows into their own estate plan.

• This type of trust can also include rules for what happens if one owner becomes incapacitated.

• It requires both owners to agree.

3. Transfer-on-Death (TOD) Deed

• At death, an owner’s share transfers to a named beneficiary or trust.

• This option is generally simple and low cost.

• It only applies at death and does not provide a plan for incapacity.

What Happens if Nothing is Done?

If the deed says “joint tenants with right of survivorship,” the surviving co-owner automatically inherits the entire property. That might be the intended outcome, or it might cut other family members out completely.

The Next Step

If you own property with someone else, whether it is a sibling, a friend, or a business partner, it is important to know how the title works. The words on that single piece of paper can determine who inherits and whether probate is involved.

At Fortis Planning, our role is to educate families in Oregon so they can make informed decisions about their estate planning options. We are not attorneys and do not provide legal advice. We do help you understand how different choices may affect your plan, and we work alongside licensed attorneys when documents need to be created or reviewed.

Schedule a free 60-minute educational consultation to review your estate planning goals. Together we can make sure there are no surprises for your family down the road.

Want to learn more before you decide? Explore our FREE Resources Page or check out answers to common questions in our FAQs.