Whose name(s) appear on the deed of real property you own? If there is only one name on the deed, the property is held in sole ownership. Property titled in sole ownership must pass through probate in the district court to assure that it is legally distributed either by the deceased’s will or Montana’s statutes on intestacy (dying without a will).
If your deed is worded as “John Jones and Mary Jones,” with no mention of a joint tenancy, Montana law defines the ownership of the real property as tenants in common. If there are two owners, each has an undivided interest of one-half; three owners, an undivided interest of one-third, and so on. When a tenant in common dies, his/her interest must pass through probate to assure that it is distributed either by the deceased tenant’s will or Montana’s statutes on intestacy.
Joint tenancy with right of survivorship (JTWRS) is a form of co-ownership in which two or more persons own the same property. A joint tenancy in real property can be held between married couples, siblings, parents and children, or persons who are not related. JTWRS is the most popular way of titling property in Montana.
The typical wording used to create a joint tenancy in real property is “John Jones and Mary Jones as joint tenants with right of survivorship and not as tenants in common.” The word “or” between the owners’ names is not typically used on a title or deed for real property.
When real property is owned in joint tenancy with right of survivorship, upon death of one of the joint tenants, the property passes automatically to the surviving joint tenant(s). Even if the deceased had written a will naming someone other than the surviving joint tenant to receive the real property, it automatically transfers by Montana law to the surviving joint tenant. No probate is required.
Example A: Donna and Jim owned their house as “Donna Chambers and Jim Chambers as joint tenants with right of survivorship.” Later Jim wrote a will leaving the house to his son from a prior marriage. Jim’s son did not receive the house. Donna automatically became the owner because the house was held in joint tenancy with right of survivorship between Donna and Jim.
Removing deceased joint tenants name
The transfer of ownership to real property held as joint tenants with right of survivorship is often overlooked until the surviving joint tenant (very often the surviving spouse) or beneficiaries of the surviving joint tenant decide to sell it or encumber it (for example, use the real property as collateral for a loan). At that point, they may be faced with the time consuming and expensive process of proving one or all joint tenants are deceased. Closings can be delayed while beneficiaries submit proof of the death of the joint tenants.
Although property held as joint tenants with right of survivorship passes automatically to the surviving joint tenant or tenants without passing through the district court probate process, the Montana legislature has provided a way for the public records to reflect such a transfer. The surviving joint tenant(s) can file a document with the clerk and recorder in the county where the real property is located. The surviving joint tenant provides the following information:
An example document, Acknowledged Statement of Termination of Joint Tenancy, is available at the Senior and Long Term Care Division, Department of Public Health and Human Services website at http://dphhs.mt.gov/SLTC/aging/legalservicesdeveloper/legal-forms.
The Acknowledged Statement must be signed and acknowledged before a notary before it will be accepted by the clerk and recorder in the county where the property is located. The recording fee for the Acknowledged Statement is $7 per page if it meets the legislative “standard” format. The form at the Senior and Long Term Care Division website meets the legislative “standard.”
The surviving joint owner must also present a completed Montana Realty Transfer Certificate (Form 488) to the clerk and recorder. This confidential tax document is required by the Department of Revenue from any party transferring real property. The form is available at any Montana county clerk and recorder’s office or online at www.revenue.mt.gov, by searching "Realty Transfer Certificate” or “Form 488.”
After the Acknowledged Statement is recorded, title to the property will appear in the name of the surviving joint tenant(s), typically the surviving spouse. Future real estate tax bills from the county treasurer’s office are sent to the surviving joint tenant(s) who now hold title to the property.
A similar procedure to update the public record ownership of real property on the death of a life tenant without probate has also been provided by the Montana legislature. A life estate is the right to the possession, use, and income from a property for the duration of a person’s life.
Example B: Jane had a house titled in her name only. In her will, Jane left the house to her husband, Jack, for his life, and then at his death to Susan, her daughter from another marriage. That wording forms a life estate with Jack as the life tenant. He cannot sell, gift, or leave the house to someone else in his written will. As the life tenant he is responsible for paying property taxes, insurance premiums, and needed repairs on the house. At Jack’s death, the property passes to Susan, who is termed the remainderman. Susan can file a document indicating the life tenant is deceased and the property passes to her as the remainderman.
Further information is available in the MSU Extension MontGuide, How to Transfer Real Property Owned in a Joint Tenancy or in a Life Estate Without Probate that can be found at http://store.msuextension.org/publications/FamilyFinancialManagement/mt201606HR.pdf or a copy of the publication can be obtained at your local MSU county or reservation Extension office.