The end of a marriage is often filled with conflict over property division, including how to divide up the home, investments, and even pets. Illinois law is clear that marital property should be divided fairly and equitably. When the parties cannot come to a mutually agreeable agreement, the court will help decide how assets and funds should be split. One important consideration during this process is understanding the differences between tenants in common vs joint tenancy.
There are a few key differences between tenancy types that impact what happens to real estate when couples divorce in Illinois. Whether the deed to a property is held as joint tenancy, tenants in common or tenancy by the entirety determines how that real estate will be treated upon death and in the event of a divorce. Those types of distinctions also impact how taxes will be applied and who gets what in a divorce.
What is Joint Property in Illinois?
The most common type of joint property is a house. Most married people purchase homes together, and the deed to a house will reflect how ownership is shared. A couple can own a house as either joint tenants or tenants in common. As the name implies, in a joint tenancy both spouses have an equal share of the property and rights to the use and enjoyment of that property. In this type of tenancy, the owners do not have a right to sell their share without the other spouse’s consent. The only difference between joint tenancy and tenancy by the entirety is that in a tenancy by the entirety, the property is considered to be owned by one entity rather than two individual persons. Tenancy by the entirety is only available to married couples, or domestic partners in some states.
If a property is held as tenants in common, the ownership percentage is based on the contribution each spouse made to the acquisition of the property. For example, if one spouse paid more of the down payment or mortgage, that person will receive a greater share of the equity in the property. This can be problematic in divorce when the value of the property increases due to market conditions. Understanding the distinctions between tenants in common vs joint tenancy is crucial for determining ownership shares.
When the spouses in a joint tenancy divorce, the property will be retitled as tenants in common. This change takes place when the spouses file a petition for divorce or their spouse fails to respond within 30 days after being served with a divorce petition. Depending on the circumstances, this may include service by publication where the petitioner publishes the divorce papers in a local newspaper. This transition from joint tenancy to tenants in common vs joint tenancy can significantly affect property rights.
Can Separate Property Ever Become Marital Property?
The definition of separate property in Illinois is that which was acquired prior to the marriage or received as a gift or inheritance. However, if that property becomes commingled with marital property (as in the case of a house where both spouses contribute time and money to improve it), then that separate property can be deemed part of the marital estate and subject to equitable distribution. This blending of assets can complicate the distinction between tenants in common vs joint tenancy during divorce proceedings.
Similarly, income from separate property can be considered marital property if it is derived from the efforts of both spouses working together (as in a business venture). Separate property can also become part of the marital estate if it is commingled with marital debt. Understanding how property can transition between tenants in common vs joint tenancy and other forms of ownership is essential for proper asset division.
If you’re married, chances are you and your spouse have shared assets and responsibilities. And, if you and your spouse decide to divorce, one of the most important considerations is how to handle those shared assets. The way you classify and title an asset can have a major impact on the equitable division of property in Illinois divorce proceedings. Many people assume that if they put both of their names on the deed of a property, it’s considered joint ownership with rights of survivorship. But, this is not always the case. The nature of how and when a person acquired an asset often plays a key role in its classification, which is why the terms of any prenuptial agreement can play such an important part in how that property is handled in a divorce. Understanding the differences between tenants in common vs joint tenancy is crucial in these scenarios.
There are several different types of joint ownership and the specifics of each have important legal implications. Most of us have heard of and are familiar with the common form of joint ownership, known as a tenancy in common. This type of joint ownership allows each party to own an equal percentage of the property and, upon death, the surviving owners will automatically take over full control of the property. This form of joint ownership is commonly used in the purchase of real estate. It is also the form of joint ownership typically used in the operation of bank accounts and other financial investments. The distinction between tenants in common vs joint tenancy plays a significant role here.
Another important form of joint ownership is known as a tenancy by the entirety. This type of joint ownership is available only to married couples and it provides a benefit similar to that of a joint tenancy with the right of survivorship. Under this arrangement, neither spouse can voluntarily or involuntarily transfer their interest in the property to a third party and it is protected from the creditors of either spouse. Understanding tenants in common vs joint tenancy is essential when considering such protections.
Despite the advantages of this form of joint ownership, there are certain circumstances in which it may not be appropriate. The most common circumstance occurs when a married person adds a non-spouse to an account or other document and that individual later dies without a will. When this happens, the other owner’s heirs may claim ownership of the property because, despite the fact that the original account was in joint tenancy with the right of survivorship, there is no evidence that the deceased had a “donative intent” to give the asset to that party. It’s essential to recognize the differences between tenants in common vs joint tenancy to avoid such complications.
For this reason, it’s important to consider the specific circumstances and circumstances surrounding any asset before deciding which form of joint ownership is most appropriate. A qualified divorce lawyer can explain the benefits and drawbacks of each type of joint ownership and help you choose the form that’s best for your situation. In the case of a divorce, a lawyer can also review any prenuptial agreements that you and your spouse have in place to determine what will happen to the assets in the event of a marriage dissolution. Properly understanding tenants in common vs joint tenancy can significantly impact the outcome of property division in divorce.
Ultimately, the distinction between tenants in common vs joint tenancy affects not just the ownership and control of property during marriage but also the division of assets in the event of a divorce. Each type of ownership has its specific implications, and knowing these differences can help in making informed decisions about property and asset management.
A divorce is not an easy process for most couples. It’s especially difficult when there are disagreements over property division. The division of assets and debts is a key part of any divorce, and it’s important to distinguish between separate (non-marital) and marital property. This is because the law treats each type of property differently during a divorce. In Illinois, a judge determines what is fair during a divorce by evaluating each spouse’s financial circumstances and contribution to the marriage. The court will also look at what is called “equitable distribution.” Understanding the differences between tenants in common vs joint tenancy is crucial in these scenarios.
When people buy a house together, they can hold it in various ways. They can hold it as joint tenancy, tenants in common or even a “tenancy by the entirety.” These labels on the deed affect what happens to the real estate in life, death and (sometimes) divorce. The distinction between tenants in common vs joint tenancy becomes particularly important during these events.
For instance, joint tenancy is the default form of ownership for married people. This is the most common way a couple holds property, and it comes with rights of survivorship. If a married person dies, their share of the property passes to the surviving spouse. However, this can be changed by filing a deed changing to a tenancy in common. In a tenancy in common, owners own an undivided interest in the property, and their shares can be divided or sold. The deceased owner’s share will then pass in accordance with their will or, if there is no will, through the state’s intestacy laws. The tenants in common vs joint tenancy distinction affects how these shares are managed.
Tenancy by the entirety is a unique type of joint tenancy created specifically for married people. It functions like joint tenancy, but there are two important distinctions: It can only be used on real estate and it protects property from creditors. To create a tenancy by the entirety, both parties must sign a deed. If one party transfers their interest in the property to a third party, this must be done with a quit claim deed. If this is not done correctly, the tenancy by the entirety status will be lost and the property will become fair game for judgment creditors. Recognizing the implications of tenants in common vs joint tenancy is essential for such legal protections.
A tenancy by the entirety is an effective way to protect a home during a divorce. It is, however, a complex legal arrangement and it’s best to seek advice from an experienced divorce lawyer. The right attorney can explain your options and help you protect your interests in a divorce. Understanding tenants in common vs joint tenancy can significantly impact the outcome of your property division.
Ultimately, the distinction between tenants in common vs joint tenancy affects not just the ownership and control of property during marriage but also the division of assets in the event of a divorce. Each type of ownership has its specific implications, and knowing these differences can help in making informed decisions about property and asset management.
Law Office of Russell D. Knight
1165 N Clark St #700, Chicago, IL 60610, United States
(773) 334-6311