What Assets Can Be Owned As Tenants By The Entirety In Florida?

Tenancy By the Entirety (TBE) is a real estate property ownership structure for married couples. It's intended to ensure that real estate, whether it's a family home or other property, seamlessly transfers to the surviving spouse when the other one dies. Then, the spouse living in the house would be considered the tenant by the entirety and the property would not need to go through probate.

How Does Tenancy By the Entirety Work?

First, this type of property ownership structure is only recognized for married couples. Even if unmarried partners, or a parent and child, have jointly held assets, they cannot structure the property transfer as a TBE.

The only owners of a TBE property must be the two married people. It's also not legal in all states. However, Florida recognizes this kind of arrangement. Furthermore, the state allows couples to not only own real estate but also personal property.

Under this arrangement, both spouses have an equal ownership interest in the property, no matter who paid more money for it. They also have an equal say in the disposal of the property, such as the decision to sell it. If one spouse dies under a TBE arrangement, then the surviving spouse is automatically the sole owner of the home or homes – no need for a formal probate proceeding.

However, if the couple divorces, then the TBE arrangement may be terminated. If divorced spouses continue to own the property, the arrangement becomes a Tenants In Common one, in which each individual may sell or transfer their share of the property to whomever they wish.

What Assets Can by Owned as Tenants by the Entirety?

While the most common assets owned under a TBE agreement tends to be real estate, other types of assets such as vehicles, bank accounts, and other types of personal property can be owned as tenants by entirety. Basically, anything that can be owned jointly can be owned as tenants by entirety.

Benefits To Tenants By the Entirety

There are two main advantages of a TBE for married couples. The biggest and most immediate benefit is that this arrangement shields the property from debts incurred by one spouse. If the indebted spouse dies, creditors cannot place a lien on the home unless the debt is in both people's names. So if a spouse dies and has debts to their name, any assets owned jointly as tenants by the entirety cannot be seized in order to pay off that debt.

Second, a TBE streamlines some parts of the estate settlement process, since it allows the asset in question to skip probate, instead transferring the title of the property directly to the surviving spouse.

Tenancy By the Entirety is usually the best option for married couples who own a home. It allows the grieving spouse to remain in their house and have some stability after the other one dies.

The Bottom Line

There are several benefits to creating a TBE arrangement. First, it ensures a seamless transfer of property to one spouse without the need for probate and avoids any taxes or potential creditor liens on the home. It allows the spouse to keep the house and shields it from collections.

Do You Need Help Creating a TBE Arrangement?

If you’re wondering whether a TBE arrangement is for you, ClearEstate can help. We're a professional estate planning service in Florida. Our estate planners can assist you with asset allocation, estate planning, writing a will, and giving you tips on reducing the tax burden for your heirs. Get in touch today for a free consultation.