Property owners can hold title to real property in several ways, one of which is joint tenancy.
Joint tenancy as estate planning
Before family trusts became popular, families often used joint tenancy as a form of estate planning to transfer real property between generations while maintaining the Proposition 13 factored base year value and avoiding reassessment.
Key features of joint tenancy
Joint tenancy is a form of co-ownership that must meet the following four unities:
Unity of interest: Each owner has an equal interest in the property.
Unity of time: All owners acquire their interest at the same time.
Unity of possession: All owners have equal rights to possess the property and the right of survivorship.
Unity of title: The document must specify joint tenancy as the vesting. If not specified, ownership is presumed to be tenancy in common.
Changes in ownership and reassessment
When property is acquired as joint tenants, it may trigger a change in ownership unless exclusions apply.
Adding a new joint tenant does not trigger reassessment if the original joint tenants remain on title. This is known as the "creation of joint tenancy."
If the added joint tenant (referred to as the "other-than-original transferor") is later removed, the property reverts to the original transferors. This "reversion" does not trigger reassessment.
Restrictions
Joint tenancy is exclusively for individuals. Trusts or legal entities cannot be joint tenants with individuals. In such cases, the ownership must be held as tenants in common.
Filing requirements
When recording a grant deed, quitclaim deed, affidavit of death of joint tenant, or affidavit of death of trustee, complete the Preliminary Change of Ownership Report (Section A). This form provides the Assessor with essential details about the transfer.
