Conversion to Joint Tenancy

Sure. See an attorney. (S)he is the only one who can tell you if this will achieve your objective.

Ira Smilovitz

Even if it were a good idea (it's probably not), what you are doing is not likely to be effective. It is highly unlikely that you can change the title to things that have a written title, like real estate, automobiles, bank and stock brokerage accounts, with a separate writing and not changing the title on the normal document for doing so.

Normally community property is considered better (at least for appreciated assets) than joint tenancy. The reason is that, under federal tax law, when one spouse dies the joint tenancy property gets a stepped up basis in half of the property, while community property gets a stepped up basis in the whole property. So that if the surviving spouse sells, for example, the family home to get a smaller place, the taxable capital gain would be much less for community property.

Apparently Texas has a method for providing for the automatic passing of community property from one spouse to another, with the kind of agreement you mention - but NOT converting it to joint tenancy. You can read about it here:

This does not seem to be a simple document though. You should definitely seek help from a lawyer. Because even a small mistake could make the document invalid, and that could have a devistating effect on your entire estate plan.

I have no idea what your assets are (amount and type) now or will likely to be at the time of the first death, but it seems you are closing the door on a step up basis in half of the value of your assets at the time of the first death. You might be better off leaving everything as community property and creating a trust to avoid probate.

As Ira has posted - see an attorney to go over your specifics.

And why are you asking the question AFTER "It has been notarized and signed by ourselves and two witnesses"?

In Texas, which is a community property state, my wife and I generated a document which states that all of our possssions, real estate, vehicles, and accounts of any type, whether created or inherited, shall be considered to be held as "joint tenancy with right of survivorship". It has been notarized and signed by ourselves and two witnesses.....

The purpose is to avoid probate....

Does anyone have any comments on this ? ========= Since you're declaring it as something OTHER than community property, you risk getting only half a step-up when someone dies, depending on your state's laws. One can have joint tenancy with a person other than a spouse.

Avoidance of probate is better done with a grantor trust.

I'll agree with that.

That may be the case, but it depends on the state you are in. Texas apparently has an alternative to passing community property without probate, and without needing to have a trust.

Even in California, where you are as I recall, passing property (community property or not) from one spouse to another does not require a trust to avoid probate. Unless other arrangements are made, there is an abbreviated probate procedure that takes 30 days, requires only one court hearing, and is much easier and cheaper than a regular probate.

Also, California allows real estate deeds to be listed as "community property with rights of survivorship." This is identical to joint tenancy in terms of survivorship, but is merely called community property to qualify for stepped up basis under ?1014.

Also, California has a new way to transfer your principal residence to a spouse or anyone else, without probate and without the necessity of a trust - it's a TOD deed, standing for Transfer on Death. It does not have the potential downsides of joint tenancy, but does the job for the most part.