Tenants by Entirety

As a statutory form of Asset Protection, Florida allows married persons to own property in a manner single people cannot.  Tenants by Entirety is NOT the same as joint tenants with rights of survivorship.  It is also not community property.  In fact, Florida does not recognize community property.  Joint tenants with rights of survival (JTWROS) offers no asset protection.  Tenancy by entireties (TBE) offers “Rights of survivorship” and asset protection from creditors of one spouse or the other, but not both.  “Rights of Survivorship” means that upon the death of one spouse, the surviving spouse automatically owns the property.
Many married people incorrectly believe that their jointly owned property is protected from their creditors.  Any property brought into the marriage is not protected.  A creditor of either spouse may seize the interest the debtor spouse holds in joint tenant property.  That is to say that a creditor may attack tenants by the entirety property if both spouses share the particular debt – like home mortgages.  This is why it is not advisable for married partners to join in all debt.
HOW DOES PROPERTY QUALIFY TO BE TENANTS BY ENTIRETY?
Unlike joint ownership with rights of survivorship, “tenants by entireties” ownership affords excellent asset protection benefits. In Florida, tenants by entireties protection is only when property meets the following stringent qualifications:

  • unity of possession, joint ownership and control,
  • unity of interest, identical interest in the property,
  • unity of title, the interest must have originated in the same instrument,
  • unity of time, the interest must have commenced simultaneously,
  • unity of survivorship, upon death of one spouse the surviving spouse shall be vested with full ownership
  • the parties must have been married at the time they acquired the property, and

WHAT CAN BE HELD AS TENANTS BY ENTIRETY – AND WHAT CAN I DO ABOUT CURRENT PROPERTY IN QUESTION?
Florida allows for any type of property to be characterized as tenants by entirety property – real, personal and intangible. Whether a married couple owns property as unprotected joint tenants with survivorship or as protected tenants by entireties depends on the intent of the spouses.  We can provide you with the necessary paperwork and counsel to make sure that any accounts or property are held as Tenants by Entirety and that your intent is clearly manifested.
HOW IS TENANTS BY ENTIRETY PROPERTY UNPROTECTED?
Divorce and death immediately terminates the Tenants by entirety status.  While death immediately vests sole ownership in the surviving spouse, divorce converts the tenants by entireties into a joint tenancy between the former spouses.
Tenants by entirety property is also protected in bankruptcy proceedings against all creditors except the IRS.
IS IT EVER GOOD TO NOT HOLD PROPERTY AS TENANTS BY ENTIRETY?
Sometimes.  Where a vehicles is titled in the name of both spouses and is at fault in an accident, the injured party can attack the assets of both spouses and even property held as tenants by entirety.   Caution should also be had on parents who have their name on their children’s vehicles.  Keeping the riskier spouse off the title to a home could offer a degree of asset protection, but problems could arise  should the couple separate because the owner spouse could sell or force the non-owner spouse out.