Joint Tenancy vs. Tenants in Common: What’s the difference?
When two or more people own real estate together in Iowa, the law generally recognizes two common forms of ownership: tenants in common and joint tenancy. Understanding the difference is important because each structure affects what happens to the property during the owners’ lifetimes and after one of them dies.
Tenancy in common is the most common form of co-ownership. Under Iowa law, each owner holds a separate ownership interest in the property, which may or may not be equal. For example, one owner might hold a 50% interest while two others each hold 25%. Each owner has the right to use the entire property, but their share is considered their individual asset. That means an owner can sell, transfer, or leave their interest to heirs through a will. When a tenant in common dies, their share does not automatically go to the other co-owners—instead it passes through their estate to their heirs or beneficiaries, generally through probate administration.
Joint tenancy, by contrast, includes what is known as the “right of survivorship.” This means that when one joint tenant dies, their interest in the property automatically transfers to the surviving owner or owners, without going through probate. Joint tenancy typically concerns equal ownership shares and must be clearly stated in the deed creating the ownership. Because of the survivorship feature, this form of ownership is often used by married couples or close family members who want the property to pass automatically to the surviving owner. One important aspect of Joint Tenancy ownership is that such interest automatically passes to the other joint tenant(s) even if your Will states a different outcome.
What if the conveyance document is silent? This is where things can get interesting. In Iowa, generally the default is Tenants in Common. However, there are some limited exceptions the Iowa legislature has established through statute where Joint Tenancy is the default. Because these structures can affect estate planning, taxes, and future control of the property, property owners should consider their goals carefully, confirm such deeds coordinate with their estate plan, and consult an attorney before deciding which form of ownership is best for their situation.
As always, (**disclaimer**) you should always seek legal advice for your specific situation and the issues presented herein are for informational purposes only.
