Legal Question in Family Law in California

What is the difference between joint tenancy and community property
I am disabled and my wife is the sole breadwinner in the family. Her company will allow her to purchase company stock in both our names, either as community property or in joint tenancy. In case of her death, which is better for avoiding estate taxes? In case of divorce, which will give me equal rights to the stock with the minimum legal hassle?

Asked on 3/14/00, 1:42 pm

2 Answers from Attorneys

Alvin Lundgren Alvin R. Lundgren, L.C.

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Re: What is the difference between joint tenancy and community property

California is a community property state, meaning that any asset acquired during the marriage is assumed to be a result of the joint effort of the parties even if only one is employed out of the home. So even if the property is titled in one name the other party has a claim on it. In your case you should take the stock in both names Mrs and Mr X with rights of survivorship. The survivor automatically becomes the heir.

You don't have an estate tax problem unless your joint net estate is in excess of $1,350,000. Each of you can transfer at death up to $650,000 (which amount increases over the next few years) without estate taxes. If you have a potential tax problem you should see an attorney to set up some trusts or other proper avenues which can facilitate the transfer of property at death and can minimize estate taxes. You should have wills and powers of attorney anyway.

Answered on 3/23/00, 11:18 am

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