Joint Tenants With Right of Survivorship (JTWROS)

Joint tenants with right of survivorship (JTWROS) is a type of brokerage account owned by at least two people, where all tenants have an equal right to the account's assets and are afforded survivorship rights in the event of the death of another account holder. The concept also applies to real estate property.

In this type of property ownership, a surviving member will inherit the total value of the other member's share of property upon the death of that other member. With regards to a brokerage account of this type, all members of the account are afforded the power to conduct investment transactions within the account as well.

Co-tenancy is a property law concept that describes the various ways that a piece of property can be owned by two or more people at the same time. JTWROS is one version of co-tenancy that gives co-owners the right of survivorship. This means that if one owner of the property dies, his ownership stake will pass to the surviving owners. This avoids probate, which is the legal process where a person's will is proven in court and accepted to be a valid legal document. The property of the deceased owner cannot be inherited by any heirs. The last living owner of the property will own all of the assets, and the assets will become part of his estate. In some cases, creditors that have claims against the deceased account owner's assets may be settled using assets from the deceased owner's previously owned assets.

This concept differs from a tenancy in common, in which tenants do not have the right of survivorship, and therefore, when a tenant dies, his or her ownership stake is passed on to an heir of that tenant's choosing. A JTWROS is most commonly used between married couples, or between parent and child.

The creation of JTWROS requires that the owners share what is known as four unities:

• The would-be co-owners must acquire the assets in question at the same time.
• The would-be co-owners must have the same title on the assets.
• Regardless of the individual amounts that each owner has given or paid for the assets, each owner must have an equal share of the total assets, given as 1/n percent, where n is the total number of owners.
• The would-be co-owners must each have the same right to possess the entirety of the assets.

When any one of these four unities is not met, JTWROS will not be created and instead will be treated as tenants in common, a less restrictive form of joint ownership.

During the creation of a JTWROS account, the language must be extremely clear, such as "Mr. X and Mrs. Y are to be designated joint tenants with rights of survivorship, and not as tenants in common." This is necessary because in some jurisdictions the words "joint tenancy" are automatically assumed to mean tenants in common.