As most of us know, married couples may hold title to their homestead property as tenants by the entirety. This classification of ownership allows a married couple to hold title to such property in a protected state from their individual creditors where the debt is not the joint debt of the couple.
Oftentimes, married couples who have created a revocable trust would like to transfer the title to their marital residence to their trust or trusts. This was not possible while still retaining the protections of the tenants by the entirety classification, until the Joint Tenancy Act and the Code of Civil Procedure were amended in 2011.
The amendment permits a married couple who wish to own their marital residence in their individual trust or trusts to take advantage of tenants by the entirety benefits by owning their interest in the property in their individual trust or trusts as tenants by the entirety.
A cautionary note is that if the transfer to the trust or trusts was made with the “sole intent” to avoid the payment of debts existing at the time of transfer, which the transferor was not otherwise able to pay at the time, the tenancy by the entirety protection will not be afforded.
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- FINAL REGULATIONS DEFINING MARITAL STATUS TERMS ISSUED - March 22, 2017
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- DURABLE POWERS OF ATTORNEY FOR PROPERTY: Uses and Abuses - January 19, 2017
- WHY A TRUST – SECOND IN A SERIES - December 21, 2016
- WHY A TRUST – FIRST IN A SERIES ANSWER NO. 1 - November 30, 2016
- DUELING EXEMPTIONS - December 31, 2015
- TRUST OWNERSHIP OF TENANCY BY THE ENTIRETY PROPERTY - December 31, 2015
- ILLINOIS APPELLATE COURT ALLOWS EX-MEMBER OF LONG TERM UNMARRIED RELATIONSHIP TO ASSERT A PROPERTY CLAIM FOLLOWING SPLIT UP - December 31, 2015
- DISCOUNTS MAY BE ELIMINATED FOR FRACTIONAL INTEREST GIFTS:NEW REGULATIONS FROM IRS - December 31, 2015