What do you own?

Stop and think about your assets for a moment. Then pick one and answer these questions:Do you own it alone?Is it owned with someone else, such as your spouse, or children?

As simple as these questions may appear, the answers can have a considerable impact on the dispersal of your estate.

Here’s a quick run-down on the three main types of asset ownership:
1. Sole ownership:
You own the asset alone. It is yours to use or to give away as you see fit, without any strings or reservations. If you die, it can be passed along to your heirs. These assets will pass to others through
your will, and will form part of the value of your estate.
 
2. Joint Tenancy (with Right of Survivorship):
You have an interest in an asset  which is shared with one or more other joint owners. If you die, your interest in the asset will revert to the other owner(s). You can, of course, sell or gift your interest in the asset while you are still alive but keep in mind that tax consequences may result.

Assets held in joint tenancy will not pass to your heirs via your will, and thereforeill not form part of your estate for purposes of probate. This form of ownership is often identified on certain documents, such as GIC’s or statements for an investment account, with the abbreviations JTRS or JTWRS.

Real estate example
Let’s look at an example most of us are familiar with. Spouses usually own real estate, including their principal residence, ‘as joint tenants and not as tenants in common’. This means that on the death of one spouse, the other owns the property absolutely.

The property does not pass to the surviving spouse via the will, or form part of the value of the estate for purposes of probate fees. No probate fees will be payable on the first death, though they will eventually be payable upon the death of the last surviving joint tenant.

3. Tenants in Common:
Here, you also have an interest in an asset which is shared with one or more
other owners. For example, suppose you and some of your friends own a piece of land that you plan to develop. You would most likely have taken title to the land as tenants in common. But if you were to
die, your interest in the asset would pass to your heir(s), not the other joint tenants. This will be done through your will, so in this case the asset will form part of your estate’s value.

Identify type of ownership
Once you have gone through the process of identifying all your assets, look at each of them individually and determine which of these three categories it falls into. Make a note alongside each one: S for sole
ownership, J for joint tenancy and TC for tenants in common. Once you’ve completed this process, you’ll be ready for the next step, which is to determine how each asset will be passed on.