The Dangers of Owning Property Jointly to Avoid Probate in Ohio

I’m often asked by well-meaning couples, friends or relatives whether they can avoid the expenses and delays of the probate if they own their property jointly with someone else.

This is actually a very good question and the answer is a bit more complicated than most people realize.

Yes it is true that if you own an asset jointly with rights of survivorship in Ohio, the joint tenant will automatically get the property when you pass—no questions asked. The passing of the asset will even avoid probate until the final owner of the property dies (note: joint ownership does not stop the probate process, it simply delays it). But in general, there is no need for a will or other estate planning documents to specify what you want done with an asset held in joint tenancy.

Yet here’s where it gets tricky. What if both owners die at the same time? This is not unreasonable to assume, especially in the case of married persons, couples or close relatives that spend a lot of time with each other. In this case, you would need a will to specify who gets the property if both you and the joint tenant pass away simultaneously. Otherwise a judge who doesn’t know you or your wishes will be forced to make this decision on your family’s behalf according to Ohio probate law.

Or let’s say in the case of a married couple, one spouse dies (we’ll call her Mary) and the asset passes to her surviving spouse/joint owner, John, as intended. In this scenario we’ll also say Mary and John have 3 children who expect to inherit the property once John dies.

However, John falls in love again and adds his new wife, Sally, as a joint owner when he gets remarried. To everyone’s surprise, when John eventually dies, Sally gets the property free and clear and the children of John and his first wife are left with nothing. I’m sure you wouldn’t want this to happen to your family, yet it happens every day when people blindly rely on joint tenancy to avoid probate.

And besides the numerous other tax and estate planning problems that can occur after the passing of a joint tenant, joint tenancy can also set you up for a number of other unsuspecting headaches down the road.

For example, what if you add someone as a joint tenant and later change your mind? Most people don’t realize that it’s VERY difficult to remove someone’s name from the title at this point. Not to mention, if your joint tenant is sued or goes through a divorce, the asset you share with him or her is on the line. This is not a smart position to be in—especially when it affects the place that you live!

I’m also reminded of a case I recently handled for a client who was so concerned about avoiding probate that he added his daughter to his home after his wife passed away. He learned very quickly that this was a bad decision when he was unable to refinance his home to do renovations on his bathroom because his daughter was fighting with her husband and he wouldn’t give up his dower rights to his father-in-law’s property. It was a very bad situation for all parties involved.

So instead of relying on joint tenancy to avoid probate or pass your assets free and clear to your spouse or other desired heir, I would advise you to sit down with an attorney to find out exactly how joint tenancy would affect your family when you pass. The decision may have consequences you never intended and may ultimately disinherit your loved ones or cause major legal problems down the road.