Loading the player...

What does 'Joint Tenants With Right of Survivorship - JTWROS' mean?

Joint tenants with right of survivorship (JTWROS) is a type of brokerage account owned by at least two people, where all tenants have an equal right to the account's assets and are afforded survivorship rights in the event of the death of another account holder. The concept also applies to real estate property.

In this type of property ownership, a surviving member will inherit the total value of the other member's share of property upon the death of that other member. With regards to a brokerage account of this type, all members of the account are afforded the power to conduct investment transactions within the account as well.

BREAKING DOWN 'Joint Tenants With Right of Survivorship - JTWROS'

Co-tenancy is a property law concept that describes the various ways that a piece of property can be owned by two or more people at the same time. JTWROS is one version of co-tenancy that gives co-owners the right of survivorship. This means that if one owner of the property dies, his ownership stake will pass to the surviving owners. This avoids probate, which is the legal process where a person's will is proven in court and accepted to be a valid legal document. The property of the deceased owner cannot be inherited by any heirs. The last living owner of the property will own all of the assets, and the assets will become part of his estate. In some cases, creditors that have claims against the deceased account owner's assets may be settled using assets from the deceased owner's previously owned assets.

This concept differs from a tenancy in common, in which tenants do not have the right of survivorship, and therefore, when a tenant dies, his or her ownership stake is passed on to an heir of that tenant's choosing. A JTWROS is most commonly used between married couples, or between parent and child.

Creation of JTWROS

The creation of JTWROS requires that the owners share what is known as four unities:

• The would-be co-owners must acquire the assets in question at the same time.

• The would-be co-owners must have the same title on the assets.

• Regardless of the individual amounts that each owner has given or paid for the assets, each owner must have an equal share of the total assets, given as 1/n percent, where n is the total number of owners.

• The would-be co-owners must each have the same right to possess the entirety of the assets.

When any one of these four unities is not met, JTWROS will not be created and instead will be treated as tenants in common, a less restrictive form of joint ownership.

During the creation of a JTWROS account, the language must be extremely clear, such as "Mr. X and Mrs. Y are to be designated joint tenants with rights of survivorship, and not as tenants in common." This is necessary because in some jurisdictions the words "joint tenancy" are automatically assumed to mean tenants in common.

RELATED TERMS
  1. Tenancy In Common

    Tenancy in common is a way for two or more people to maintain ...
  2. Co-Owner

    A co-owner is an individual or group that shares ownership in ...
  3. Joint

    Joint is a legal term describing a transaction or agreement where ...
  4. Tenancy At Sufferance

    Tenancy at sufferance is a legal circumstance when a property ...
  5. Co-Tenancy Clause

    A co-tenancy clause in retail lease contracts allows tenants ...
  6. Tenancy at Will

    Tenancy at will is a property tenure — without a lease or written ...
Related Articles
  1. Investing

    Top 4 Nightmares For Real Estate Investors

    Renting out your property is not without risks; the good news is, they don't have to keep you up at night.
  2. Financial Advisor

    3 Things to Consider When Renting By the Room

    Although renting by the room can increase returns on rental property, it does come with a few caveats.
  3. Retirement

    How Survivorship Life Insurance Works

    Should you buy a survivorship life insurance policy?
  4. Investing

    Leasing to Section 8 Tenants?

    Real estate investors and landlords: It's worthwhile to investigate the section 8 market. Learn about the pros and cons of leasing to section 8 tenants.
  5. Investing

    Becoming a landlord: More trouble than it's worth?

    On the surface, being a landlord seems likes like a surefire bet, but could it be more of a headache than its worth? Find out if being a landlord is the right investment for you.
  6. Investing

    Is Property Management Worth it? Ask Yourself These 8 Questions

    If you own rental properties, ask yourself these questions when deciding who should manage them.
  7. Personal Finance

    The Hidden Costs Of Renting The Basement

    There's more to being a landlord than just collecting rent every month.
RELATED FAQS
  1. Single, double and triple net leases

    Learn the ins and outs of net lease agreements, including the key differences between single net, double net and triple net ... Read Answer >>
Hot Definitions
  1. Futures Contract

    An agreement to buy or sell the underlying commodity or asset at a specific price at a future date.
  2. Yield Curve

    A yield curve is a line that plots the interest rates, at a set point in time, of bonds having equal credit quality, but ...
  3. Portfolio

    A portfolio is a grouping of financial assets such as stocks, bonds and cash equivalents, also their mutual, exchange-traded ...
  4. Gross Profit

    Gross profit is the profit a company makes after deducting the costs of making and selling its products, or the costs of ...
  5. Diversification

    Diversification is the strategy of investing in a variety of securities in order to lower the risk involved with putting ...
  6. Intrinsic Value

    Intrinsic value is the perceived or calculated value of a company, including tangible and intangible factors, and may differ ...
Trading Center