There is significance in property being classified as probate or nonprobate property in terms of the need for probate, creditors’ claims and payment of federal estate and state estate and inheritance taxes is that. If property is classified as probate then that means that it is the decedent’s property that is subject to estate administration by the personal representative. It also means that the probate property is subject to creditors’ claims and federal and state death taxes. Nonprobate property is not subject to probate because it cannot be transferred by will or inheritance. The nonprobate property goes straight to the named beneficiary or to the surviving joint tenant(s) or partners. Nonprobate property is part of the decedent’s gross estate for federal and state death tax purposes; it is subject to federal and state estate taxes and state inheritance tax. 27.
Joint tenancy is different from both tenancy in common and a tenancy by the entirety. Joint tenancy is different from tenancy in common because joint tenancy is the ownership of real or personal property by two or more persons with the right of survivorship; whereas, tenancy in common is the ownership of an undivided interest of real or personal property by two or more persons without the right of survivorship. In a tenancy in common, each person has the right to hold or occupy the whole property in common with the other co-tenants, and each is entitled to share in the profits derived from the property. Unlike a joint tenancy, when a tenancy in common dies, the decedent’s interest goes to an heir or as directed in a will. Joint tenancy is unlike tenancy by the entirety. Tenancy by the entirety is a form of joint tenancy with the right of survivorship available only to a husband and wife. It cannot be terminated by one joint tenant’s inter vivos conveyance of his or her interest. Neither one of the tenants by the entirety can transfer the property or sever the tenancy by the entirety without...
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