Tenancy By The Entirety
A tenancy by the entirety ("TBE") is a unique form of legal ownership of property that comes to us from old English common law. It is only available to married couples, granting both spouses an equal and indivisible right to use and enjoy the entire property. Upon the death of one spouse, title becomes fully vested in the surviving spouse as a matter of law, and no probate proceedings are required.
TBE ownership is highly useful as an asset protection planning tool because the creditor of one spouse cannot interfere with the legal right of the other spouse to use, possess, and enjoy the entirety of the TBE property. Therefore, in jurisdictions that recognize tenancy by the entirety for married couples, a judgment creditor of one spouse cannot force the sale of the TBE property to satisfy its judgment.
Today, about half the states in the country still recognize TBEs. Laws vary from state to state as to what types of property may be owned as a TBE as well as what other requirements must be satisfied to qualify for TBE ownership. For example, some states only allow real estate to be owned as a TBE. Other states allow both real estate and certain personal property, such as bank accounts, etc., to be titled in this way.
General Requirements for TBE Property
Some states have unique requirements for property held as tenants by the entirety. For example, Illinois will only allow a homestead to be held as a TBE property. Yet, all TBE jurisdictions tend to share the following characteristics:
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Both spouses must acquire ownership from the same instrument (e.g., deed, bill of sale)
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Both spouses must acquire ownership together at the same time
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Both spouses must have joint control
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Both spouses must have an identical ownership interest in the property
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Both spouses must have been married (to each other) at the time they acquired the property
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The surviving spouse must become the owner the property after the other spouse dies
Limitations on the Asset Protection Value of TBE Property
Although tenancy by the entirety is a powerful and inexpensive tool that can be used to protect property, there are some important limitations. If a married couple divorce, or if the judgment-free spouse should die first, the creditor can force the sale of the property to satisfy its judgment. Thus, TBE is not a perfect asset protection tool.
Matrix of State TBE Laws
The following is a matrix of Tenancy by the Entirety laws listed by state. Please note the following:
- States marked with ** are Community Property states.
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DISCLAIMER: This matrix of state-by-state tenancy by the entirety laws may not be the most current. This matrix is provided for information purposes only. Please verify from official sources before using for legal purposes.
State
TBE Recognized Under State Law?
TBE for Real Property?
TBE for Personal Property?
Alabama
No
No
No
Alaska
Yes
Yes
Yes
California**
No
No
No
Colorado
No
No
No
Connecticut
No
No
No
Delaware
Yes
Yes
Yes
District of Columbia
Yes
Yes
Yes
Florida
Yes
Yes
Yes
Georgia
No
No
No
State
TBE Recognized Under State Law?
TBE for Real Property?
TBE for Personal Property?
Hawaii
Yes
Yes
Yes
Idaho**
No
No
No
Illinois
Yes
Yes
Yes
Indiana
Yes
Yes
No
Iowa
No
No
No
Kansas
No
No
No
Kentucky
Yes
Yes
No
Louisiana**
No
No
No
Maine
No
No
No
State
TBE Recognized Under State Law?
TBE for Real Property?
TBE for Personal Property?
Maryland
Yes
Yes
Yes
Massachusetts
Yes
Yes
Yes
Michigan
Yes
Yes
No
Minnesota
No
No
No
Mississippi
Yes
Yes
Yes
Missouri
Yes
Yes
Yes
Montana
No
No
No
Nebraska
No
No
No
Nevada**
No
No
No
New Hampshire
No
No
No
State
TBE Recognized Under State Law?
TBE for Real Property?
TBE for Personal Property?
New Jersey
Yes
Yes
Yes
New Mexico**
No
No
No
New York
Yes
Yes
Yes
North Carolina
Yes
Yes
No
North Dakota
Yes
Yes
No
Ohio
No
No
No
Oklahoma
Yes
Yes
Yes
Oregon
Yes
Yes
No
Pennsylvania
Yes
Yes
Yes
Rhode Island
Yes
Yes
Yes
State
TBE Recognized Under State Law?
TBE for Real Property?
TBE for Personal Property?
South Carolina
No
No
No
South Dakota
No
No
No
Tennessee
Yes
Yes
Yes
Texas**
No
No
No
Utah
No
No
No
Vermont
Yes
Yes
Yes
Virginia
Yes
Yes
Yes
Washington**
No
No
No
West Virginia
No
No
No
Wisconsin**
No
No
No
Wyoming
Yes
Yes
Yes
Please note the following:
- States marked with ** are Community Property states.
-
DISCLAIMER: This matrix of state-by-state tenancy by the entirety laws may not be the most current. This matrix is provided for information purposes only. Please verify from official sources before using for legal purposes.