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Tenancy in Common and Florida Estate Planning

House photo illustrating tenancy in common in Florida

Florida law recognizes three basic forms of joint ownership.  Two of the three—joint tenancy and tenancy in the entireties—come with what is referred to as a “right of survivorship.”  What that means is that, when one co-owner dies, the surviving owner automatically receives full, undivided ownership of the asset.  By definition, a co-owner who holds a partial interest in a tenancy in the entireties or joint tenancy with right of survivorship cannot transfer that interest to heirs through probate—because the interest never makes it into the probate estate.  Also, with a joint tenancy or tenancy in the entireties, though, the joint interests must be equal.  The third ownership form and the focus of today’s topic is the one without a right of survivorship and that can be transferred through probate—is called tenancy in common.  Rather than owning a property together, tenants in common each own a percentage interest that can be transferred.  Florida law assumes a 50/50 split, but the percentages can be different if the owners decide otherwise. This means that tenancy in common and Florida estate planning strategies can be utilized for various purposes when a right of survivorship is not the goal.

Using a Tenancy in Common for Strategic Estate Planning in Florida

If an asset is owned by more than two co-owners, title is usually held as tenants in common, with each owner owning their respective percentages.  Because tenancy in the entireties is reserved for married spouses only, by definition it is limited to two owners.  Though uncommon, a joint tenancy can include three or more joint owners.  The way it works is that, when an owner dies, his or her interest merges with the interest of the remaining owners.  Instead of having a joint tenancy with three owners, for instance, you now have a joint tenancy with just two.  The process continues until only one living owner remains—and that final surviving owner then holds complete, undivided title to the property—kind of like Highlander.

For purposes of understanding a tenancy in common and Florida estate planning, it’s worth mentioning that, although real estate is the most common example when discussing joint ownership models, other assets can be jointly held, too.  In Florida, valuable personal property, financial accounts, and most other estate assets in Florida can be jointly owned as tenants in common, joint tenants, or tenants in the entireties.

Creating a Tenancy in Common in Florida

When starting your Florida estate planning, understand that tenancy in common is considered the default form of co-ownership in Florida.  If a deed with more than one owner doesn’t unmistakably state that the owners are tenants by the entireties or joint tenants “with a right of survivorship,” they are assumed to be tenants in common.  Tenancy in common can also be created through the “destruction” of one of the other two co-ownership models.  Joint tenancies are destroyed if a creditor attaches the property in Florida or if either owner transfers an interest.  In fact, transfer of an interest destroys a joint tenancy even if the transfer is from one owner to another.

Because tenancy by the entireties in Florida is reserved exclusively for married spouses, it can be destroyed by divorce.  If former tenants in the entireties are no longer married, they become tenants in common, with each assumed to own a 50% interest unless a property settlement agreement says otherwise.

Estate planners tend to like joint tenancy as well as tenancy by the entireties because they provide a clean and easy means of conveying property rights to family members.  The joint ownership interest transfers to the surviving owner outside probate, letting you avoid some of the time and expense of estate administration.  Sometimes, though, you want to leave your interest in a joint asset to someone other than the other owner.  When that’s the case, you need a tenancy in common for your Florida estate planning.  And the joint-ownership interest may need to go through probate administration in Florida.

Tenancy in Common in Florida Probate

In general, an interest in a tenancy in common is the only type of joint interest that passes through probate, and it can be transferred via provisions in a Florida last will or through intestate succession in Florida—more or less like any other property interest.  So, for instance, if you own a 50% share of an investment property as tenants in common with your business partner, you can bequeath that 50% share to whoever you want in your will.  After the estate is administered, the designated heir owns a 50% interest in the property alongside your business partner in Florida, as tenants in common.

But avoiding probate is a popular goal in estate planning.  So, why would you want to use a tenancy in common for Florida estate planning when you could avoid Florida probate with a transfer on death designation or joint tenancy?

The short answer is that it gives you more control over where your joint ownership interest eventually ends up.  If you and your business partner are joint tenants and you die first, your business partner now holds complete, undivided title to the investment property.  And your heirs don’t have any right to compensation for the interest.  On the other hand, a tenancy in common lets you leave your half of the Florida investment property to whoever you like (including the other owner, if that’s what you want to do).

Even if two co-owners are spouses in Florida and the elective share may apply, there are situations in which a tenancy in common is preferable to a tenancy in the entireties.  Say, for instance, a couple co-owns an asset, and they each have children from prior relationships who they want to inherit their respective shares.  With a joint tenancy or tenancy in the entireties, the surviving spouse becomes sole owner when the other spouse dies, leaving the first spouse’s kids effectively disinherited.  Tenancy in common allows both spouses to ensure that their children ultimately inherit their shares.  However, some additional steps under the Safeharbor Act in Florida would likely need to be taken.

Potential Complications with Inherited Tenancies in Common

Tenancy in common’s capacity to be inherited raises an interesting issue.  When the heir of a tenant in common receives the decedent owner’s share, he or she receives all rights attached to that interest—including whatever right to control the inherited asset the decedent had.  So, what happens if the surviving co-owner and the newly inheriting co-owner are not on the same page as to how a jointly owned asset should be used?

Let’s say, for instance, the Florida business partnership succession plan which involves a co-owned investment property is impacted when a partner passes away, leaving his 50% interest to a long-lost brother from Nova Scotia.  You and your partner have been profitably renting out the property for years, and you want to continue receiving the consistent passive income.  But your partner’s brother lives in Canada, and, after the estate is administered, he isn’t interested in being a landlord in Florida.  He just wants to cash out his inherited interest and be done with it.

You could try to buy out his half, but maybe he wants an unreasonable price.  Or, maybe you don’t have the liquidity for the purchase right now and don’t want to encumber the property to secure a loan.

Under Florida law, a co-owner has the right to file a partition suit asking a court to split a co-owned property.  That could mean physically dividing a property into two or more sections, but physical partition is usually only feasible with unimproved acreage.  If a property with improvements is involved, the partition complaint will probably ask for a court-supervised sale, with the proceeds to be split between the two owners.

Interestingly, this scenario is a potential problem even if the property in question is used by the owners as a residence.  Let’s say an unmarried couple co-owns and lives in a residence they purchased together.  They each have children from prior relationships who they want to inherit their respective shares, and so they elect to own the residence as tenants in common.  Upon the first owner’s death, his or her heir inherits a half interest in the residence.  The surviving owner still lives in the property, but the heir wants to force a partition.

The Florida Supreme Court has held that the Florida Constitution’s homestead provisions do not prevent a co-owner from forcing a partition sale.  So, absent proactive estate planning, there’s no reason why the heir couldn’t force the sale.

If the couple in the prior example was married, Florida’s spousal elective share and homestead laws might provide some protection to the surviving spouse (absent a spousal waiver) but could also impede the first spouse’s ability to leave a share of the property to his or her heir.  Even then, if the married couple divorces (and the property isn’t addressed in the divorce), there’s nothing stopping an ex-spouse from forcing a sale—even if the other still lives in the residence.

Tenancy in common presents some genuine estate-planning advantages in the right circumstances, but it also raises some potential challenges.  Fortunately, though, it’s nothing that can’t be addressed with proactive estate planning.  And, interestingly enough, one potential solution also avoids another drawback of tenancy in common by allowing a co-owned interest to bypass probate.

Tenancy in Common Outside of Probate

Even absent a right of survivorship, a well-thought-out estate plan can pass an interest in a tenancy in common outside probate, thereby promoting the owners’ privacy interests and avoiding the time and expense of probate administration.

One strategy is to hold a tenancy in common interest in a Florida revocable living trust.  Trust assets won’t be part of the probate estate, but, during life, the owner can continue to benefit from the asset as trustee and beneficiary of the trust.

Tenancy in Common for Florida business partners

Returning to our investment property example, let’s say our two business partners both want their separate tenancy-in-common interests to pass outside of probate and to eventually end up with their respective heirs.  At the same time, the partners want to protect one another by avoiding the risk of a future heir deciding to force a partition sale.

To accomplish all of these goals, they could both transfer their interests into two separate trusts.  Each trust provides that, upon the death of the grantor / co-owner, that owner’s heir becomes the trust’s new beneficiary.  The trustee is directed to distribute trust income (i.e., the rent earned by the property) to the beneficiary but not to permit a sale without the consent of the other owner.  Alternatively, they could each name the other as successor trustee so that, when one partner dies, the other retains the right to control the property, while distributing half of the property’s income to the decedent partner’s chosen heir.

Florida’s co-ownership options open up a number Florida estate-planning possibilities for transferring real estate, while also raising some potentially thorny complications.  An experienced Florida estate-planning attorney can provide advice on how best to use the tools provided by Florida law to accomplish your objectives without bringing about any unintended consequences.

Steve Gibbs, Esq.

24 comments… add one
  • Jose R Yow October 5, 2020, 5:51 pm

    We are looking for an attorney who specializes TIC property litigation. Can you help?

    • gibbslawfl October 7, 2020, 5:52 pm

      Hello Jose, thanks for inquiring; however, this isn’t something we get involved in as we are “laser focused” in strategic planning and related administration services.

      Best to you.

      Steve Gibbs, Esq.

  • Alcph July 23, 2021, 12:40 am

    I am a co-owner with a 75% interest in what was a marital property prior to divorce. I still reside in the home and would like to use a ladybird deed (in Florida) to preserve my adult children’s rights to the property. These are children from a prior marriage and would be alienated if my ex spouse, who is 25% co-owner, were to claim any rights because we have one minor child who still resides in the home. Can I execute this type of deed without permission or signature of the other co-owner / tenant in common?

    • gibbslawfl July 27, 2021, 6:52 pm

      Hello and thanks for commenting. The short answer is if someone is on a deed, they would need to sign the new deed. Also, where spouses are concerned, a homestead waiver would need to be added to the deed and I encourage you to seek competant advice because this is a very dicey area.

      Best, Steve Gibbs, Esq.

  • Marisol August 9, 2021, 10:59 pm

    My mother divorced 1986, decree says tenants in common, then equal split when i emancipated. My father passed away in NY, no will that we know of, she receives ss death benefits, she never changed title to herself only,or to her maiden name, also in decree. Can she do revocable trust or will need a warranty deed first?

    • gibbslawfl August 10, 2021, 12:39 pm

      Hello, with a tenancy in common, the other half of the real property may be going somewhere else. However, homestead laws, if this is a homestead in FL, would provide her a life interest in the real property. However, there are a ton of unanswered questions here and it looks like an expert should be involved. Let us know if we can help.

      Best, Steve Gibbs, Esq.

  • Diane September 5, 2021, 6:37 am

    My mother passed and her 3 biological children and 3 step children are all co owners on the deed. My brother is the executor of the will. When selling the house do all 6 owners need to sign the sale or just the executor?

    • gibbslawfl September 7, 2021, 2:48 pm

      Hello Diane, the short answer for educational purposes only and without seeing the deed is that whoever is named in it as a grantee or remainderperson has an ownership interest and would need to sign off on any sale.

      Let us know if we can help.

      Best, Steve Gibbs, Esq.

  • keith chittenden September 17, 2021, 2:45 pm

    If a Landlord sells their property to someone else and there are current renters with active leases occupying the property, Can the new owner terminate all leases and evict current tenants or raise each renter’s rent greater than what the lease outlines what the monthly rent is without giving a valid reason under Florida law ? What if the new owner utilizes the property for financial gains such as selling illegal narcotics, running gambling activities or social parties allowing their “guests” to utilize the property as they see fit against the wishes of the current tenants?

    • gibbslawfl September 19, 2021, 11:33 pm

      Hello Keith, this something that you’d need to ask a real estate litigation attorney in a private consultation setting. Best. Steve Gibbs, Esq.

  • Maria I Palacio Palacio September 27, 2021, 12:07 pm

    I am a real estate agent, my client is a foreign person who had a lot in Florida with her foreign husband, the title shows that they were owners as “tenants in common”, they were never living in the USA and never had children. Her husband passed away 4 years ago and she wants to sell her lot, can she transfer the property as the sole owner, she can prove that she was married to her husband for over 40 years and had no children, she can also prove that her husband passed away. She does not want to file a succession here, because she is a foreigner, very old, she lives out of the country and she has a client who wants to buy from her, what should she do? Can you help us? how much would your fees be? let me know, thank you very much.

    • gibbslawfl September 27, 2021, 5:06 pm

      Hello Maria, because this was a tenancy in common, a probate will likely be required to sell the lot. Our fees would vary depending upon whether a “formal administration” is needed and if there are other difficulties.

      To schedule a consultation, you can go to our website or call our office.

      Best, Steve Gibbs, Esq.

  • Thomas W Bush November 20, 2021, 11:26 am

    I own a house in Florida as a tennant in common with another individual. We both are on the mortgage for the house. The other tennant uses the house as a primary residence and i live full time in Colorado. I do not collect any rent from my ownership. Am I responsible for sharing expenses on the property if I am not receiving any rent/income from it?

    • gibbslawfl November 20, 2021, 8:34 pm

      Hello, the short is answer probably not; however, if liabilities attach to the real property to due defaults and indebtedness, liens could be attached to the real property, thereby affecting your interest. It’s worth staying proactive to make sure payments are made if you care about the property and also to prevent random lawsuits from being filed against you as a co-owner.

      Best, Steve Gibbs, Esq.

  • Henry Lee July 12, 2022, 5:19 pm

    I own a property in fee. I want to transfer it to myself and my girlfriend 50/50 as tenants in common, with each of us having the right to keep possession of the entire property after the first one dies, and then each of our halves going to our heirs when the second one dies. Can I just record a deed to the two of us as tenants in common, with each half subject to a life estate to the other after the owner’s death?

    • gibbslawfl July 15, 2022, 3:33 pm

      Hello Henry, it sounds like you need a legal consultation and thus it really isn’t a good idea to speculate in a blog comment. Your question requires some thought and additional discussion before making recommendations. You can schedule a consultation at gibbslawFL.com.

      Best, Steve Gibbs, Esq.

  • Cindy September 20, 2022, 10:26 am

    I share a duplex (two separate units) in a TIC. I paid both in full, thus no mortgage. Partner now pays a “mortgage” to me on a monthly basis and pays 1/2 share of RE taxes and insurance. I now want to buy back their share of property but hold onto said property. They have contributed less than 15% of their share of current value of building yet want to claim 50%/50% of increased value. Do we have to agree with their request or return only the portion of their mortgage paid to us plus a 15% increase in value as if the property was to be sold today.

    • gibbslawfl September 21, 2022, 1:02 pm

      Hi Cindy, the short answer would be they’re entitled to 50% however, it may be a matter of negotiation. I suggest you get some legal help via a consultation rather than trying to handle this in a blog post:)

      Best, Steve Gibbs, Esq.

  • Michelle Martin October 6, 2022, 3:44 am

    My father owns his house, he is dying! He created a quitclaim naming him and I (his daughter) as joint tenancy with right of survivorship. Question is when he passes will I owe a big chunk of real estate tax? Will the property tax go up as if I’m a new owner? Or stay the same as he’s been paying the last 20 years

    • gibbslawfl October 18, 2022, 1:24 pm

      Hello Michelle, you may need to consult with a real estate attorney about your ownership and taxes as it is difficult to comment without a thorough review. For educational purposes only, a joint tenant would receive the real property upon the other joint tenant’s death and would owe whatever taxes are owed on the property. There likely wouldn’t be an additonal estate tax if that’s what you’re asking. Lots of other questions to explore though.

      Best, Steve Gibbs, Esq.

  • Debra Wilbanks November 2, 2022, 12:55 am

    I am 50% of a tenants in common property in FL, my father was the other 50%. He recently passed and much to my written defense & objections, his atty was appointed as PR for the estate, probate has been filed and I’m wanting to sell the house. My brother and I are 50/50 beneficiaries, so I technically now own 75% and my brother 25%. How much input in the sale of this house does the PR have at this point? Am I allowed to list it and get it sold without having to get his approval with each step and just put my father’s 50% into the estate account? What legal obligations do I have to the PR who is over the estate with this house? He’s a terrible attorney and PR btw! TIA for any help you can provide with this question. Kind regards!!

    • gibbslawfl November 2, 2022, 1:22 pm

      Hello Debra, unfortunately a PR has authority over the estate and assets until the estate is finalized and assets are distributed including deeds conveyed to whomever is entitled to them. If you’re concerned about the PR, you may need to retain your own legal counsel as beneficiaries.

      Best, Steve Gibbs, Esq.

  • M. Mobley November 4, 2022, 7:23 am

    My maternal grandmother passed and the house was left to her 5 children. Before death, she added all of her children’s names to the deed as owners in Florida. I have read that if one of the siblings passes in Florida, the interest in the property automatically transfers to the other other siblings? Is this true or….will the deceased sibling’s portion go to their heirs/children via probate and interstate succession (with or without a will)?

    Similarly, on my father’s side, my paternal grandmother left her property to her kids (6) before death and added them to the deed as owners in Florida. All sold their shares to one of the siblings, except one. Now the deed shows own one sibling with 83% ownership and the other sibling with 17% ownership. The sibling with 83% ownership recently passed. Will the property need to go through probate and resultingly pass to the deceased sibling’s biological children ( 83% portion ) or will the only remaining/surviving sibling (with 17% ownership) now inherit the property? Is this considered tenancy in common or will the surviving sibling (listed as one of two owners on the deed) now inherit the property?

    • gibbslawfl November 8, 2022, 11:06 am

      Hello, both of these scenarios would require substantial additional investigation to comment on them including a better understanding of the deeds. For educational purposes only, I’m not aware of a rule about an automatic distribution to siblings unless there is no will or trust and perhaps state law is applying to determine all of the heirs. I recommend that you seek a legal consultation with an expert probate and estate planning attorney in your area.

      Best, Steve Gibbs, Esq.

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