Do you have assets that are held jointly by you and your spouse? You may have done this in order to protect those assets for one of you should something happen to the other. It is true that jointly held assets are not subject to probate. Creditors that are owed by only one spouse cannot reach the assets that are jointly held by both.

There are some dangers that exist in joint ownership of assets, as well other issues concerning elder law. You should be aware of these potential pitfalls before making a decision to put large assets in both of your names.

Many States Require Marriage for Full Benefit

There are many states that will only fully recognize joint ownership of assets for couples who are legally married. This means that even if you and your partner jointly on a car or a home, then no protection will be afforded to you with those assets if there is no legal marriage to back that ownership. Make sure that your state does not require marriage as a prerequisite before putting your assets into joint ownership.

 

Judgments Against Both Spouses Are Not Protected

If there is a case where an asset is jointly owned and some sort of judgment is made against both spouses, the asset is no longer protected. A good example of this would be joint ownership of a vehicle. If both names are on a vehicle, and the vehicle is involved in a serious accident, then any assets that are jointly owned can fall under the settlement.

This can also happen with jointly owned credit accounts. Regardless of a spouse passing away or the relationship ending, creditors can still attach to jointly owned assets.

 

Jointly Held Assets Prior to Marriage

There is an assumption that assets that were owned by both people before a marriage will immediately become joint ownership under the law once marriage paperwork was filed. This is not always the case. In some states, that joint transfer of ownership is not automatic and must be done legally. Before assuming that your assets are protected by joint ownership, speak with your attorney to find out what the laws specific to your state might be and what you need to do to have official “joint ownership.”

 

Proper Accounting Is Necessary for Protection

When talking about bank accounts, credit accounts or loans, there are very specific things that must be done to ensure the legal status of joint ownership. Many people think you only need to add the spouses name to the account, and that is all that needs done. This is not true.

Accounts must be properly created as joint accounts in order to confer the proper protections. Make sure that you specify you wish a joint account to have the paperwork filed properly.

 

Trust Stano Law Firm for Your Elder Law Needs

Do you need other options for protecting your assets or creating an estate plan? Then contact Stano Law Firm today for your elder law needs.