BEWARE: Risks of Joint Tenants to Avoid Probate
Adding a Name to Land Title or Bank Accounts: Joint Tenants for Avoiding Probate
Bank accounts and land can be both be owned as joint tenants or as tenants in common in Alberta. Joint tenants own the land equally. In Alberta, this means there is a right of survivorship. A right of survivorship means that a surviving joint tenants benefits from and becomes full owner of the share of the person who passed away. Only joint tenants have a right of survivorship in Alberta. Tenants in common do not have a right of survivorship. Each tenant in common’s share is gifted to the beneficiaries as stated in the person’s will. This means that probate will be required for tenants in common but not for people who have used a joint tenant for avoiding probate.
A Joint Tenant For Avoiding Probate
People often fear the consequences of probate. They will add a joint tenant for avoiding probate. Most people fear that there are excessive taxes, probate fees, administrative probate processes, legal costs, etc. It comes as a surprise to people who have added a joint tenant for avoiding probate that their savings are not that significant in Alberta. Probate fees in Alberta are scaled depending on the size of the estate. The Government of Alberta probate fees reach a maximum of $400. While there are legal fees and it can take time to probate an estate, the benefits of a joint tenant for avoiding probate may not be worthwhile.
Risks of Avoiding Probate With A Joint Tenant
There are several dangers to adding a joint tenant for avoiding probate fees. If you prefer to watch a Kahane Law Legal Minute video on these dangers of joint tenants for avoiding probate use this link. The following are the most common dangers that people do not think about when they use a joint tenant to avoid probate:
- Increased Income Taxes
- Loss of Control of Land or Assets
- Family Disputes
- Estate Litigation
- Final Tax Return (death tax) Problems
- Divorce of the Joint Tenant Issues
- Creditors Can Seize Land or Assets
- Inadvertent Trusts
- Beneficiaries Not Getting Planned Gifts
- Intended Distribution In Will Not Followed
Learn more about the risks of adding a joint tenant for avoiding probate. We have detailed information on our website regarding each of these risks and how you can ask one of our estate lawyers for help.
Information on Costs of Transferring Title to Add a Joint Tenant
If you want to understand the costs and process for adding a joint tenant for avoiding probate, the real estate lawyers at Kahane Law Office in Calgary can help. This link will give you the information you need on transferring title to a joint tenant or from a tenant in common. Once you know the risks and make an informed choice the process is quick, easy and inexpensive to transfer a land title. Learn more here for our low flat rates on land title transfers.
Avoiding Problems Associated with Joint Tenants for Avoiding Probate:
There are some ways to limit the risks of adding a joint tenant for avoiding probate. These usually entail having a detailed plan and a well documented estate plan. In some cases the risks cannot be avoided. It is very important that you understand these risks before you transfer title to a joint tenant for avoiding probate.