There are situations were joint ownership is desirable. In addition to avoiding probate, a bank account jointly owned will provide easy access for both spouses during their lifetimes and for a surviving spouse. If a person owns a closely held business, placing other property in joint ownership with a spouse could qualify the business for certain estate tax benefits. Because of the unlimited marital deduction, this type of transfer can be accomplished without any gift tax imposition. Lastly, in many jurisdictions, a spouse who may be vulnerable to claims of third parties could protect a home or other real estate from such claims by owning such property with a spouse as tenants by the entirety.
Joint tenancy is the simplest probate avoidance method.
In this type of ownership each person's interest can be disposed of without the other owner's consent. This prevents one joint owner from selling or transferring property without the consent of the other joint owner. In certain instances, the creation of a joint interest is subject to gift taxes. A partial loss of increased tax basis as a result of the inability to step-up the value to the value at the date of death. When one owner dies, his or her share will usually pass on to his or her heirs rather than to the joint owner.