These are assets which are held "jointly" or co-owned by two or more individuals, known as Joint Tenants. When one of the joint tenants passes away, survivorship rights dictate what happens to the deceased co-owner's share of the property.
This also means that the asset doesn't become part of the deceased co-owner's Estate, and it doesn't go through the traditional probate process. The designation can be applied to real estate property, as well as many types of financial accounts.
Key points about survivorship rights include:
Right of Survivorship: For assets that are held jointly, co-owners have the "right of survivorship" which means that when one co-owner dies, their interest in the property automatically passes to the surviving co-owner(s) without the need for probate.
Avoiding Probate: Survivorship rights help streamline the transfer of an asset after death. Since the asset automatically passes to the surviving co-owner(s), it's considered a Non-Probate Asset. This is in contrast to assets solely owned by the deceased, which typically go through probate in order to be distributed to Heirs and other Beneficiaries.
Application: Survivorship rights apply to real estate, bank accounts, investments, and other jointly owned property that has the right of survivorship explicitly stated. Not all joint ownership arrangements have survivorship rights; for example, tenants in common do not have survivorship rights.
Documentation: To establish survivorship rights, the ownership documentation (such as a deed or account agreement) must clearly indicate that the co-owners hold the asset with "rights of survivorship." This distinction is crucial for determining how the property will be transferred upon the death of a co-owner.
Not Affected by a Will: Survivorship rights take precedence over the terms of a Last Will and Testament. Even if a will specifies how the deceased co-owner's property should be distributed, property with survivorship rights goes directly to the surviving co-owner(s).
Multiple Deaths: If there are multiple co-owners and one of them passes away, the survivorship rights of the remaining co-owners are unaffected. The property passes to the surviving co-owners until the last surviving co-owner.