Question: What does Tenants by the Entirety (TBE) ownership mean and does TBE ownership protect property from claims of creditors?
Answer: In most states, a married couple may own several types of property TBE, including, but not limited to, bank accounts, real property and personal property. In fact, the law presumes that real property acquired by a married couple in the state of Maryland is TBE property.
The benefit of owning property TBE is that it is exempt from process to satisfy debts owed to individual creditors of either spouse. This is because an interest in TBE property is not equivalent to one half of the equity in the property, but rather, a non-severable interest in the whole owned by both spouses.
However, TBE is not the perfect asset protection tool as it can be broken or severed; for example:
• TBE property is not exempt from process to satisfy joint debts of both spouses;
• TBE protection dissolves if one of the spouses passes away; and
• TBE protection is broken by divorce.
As always, if you have any questions or would like to learn more, please contact Steve Shane at firstname.lastname@example.org or .
ABOUT STEVE SHANE
Steve Shane provides strategic counseling to clients in need of estate administration, charitable giving and business continuity planning while minimizing estate, gift, and generation-skipping transfer tax exposure. He offers legal guidance to clients on asset protection and the proper disposition of assets in accordance with the client’s objectives, while employing tax planning techniques such as the use of irrevocable trusts, life insurance planning, lifetime gifts and charitable trust. He is also experienced with drafting documents for business planning, the incorporation and application for exemption for Private Foundations and the administration of decedents’ estates.
ABOUT OFFIT KURMAN
Offit Kurman is one of the fastest-growing, full-service law firms in the Mid-Atlantic region. With over 170 attorneys offering a comprehensive range of services in virtually every legal category, the firm is well positioned to meet the needs of dynamic businesses and the people who own and operate them. Our eleven offices serve individual and corporate clients in the Virginia, Washington, DC, Maryland, Delaware, Pennsylvania, New Jersey, and New York City regions. At Offit Kurman, we are our clients’ most trusted legal advisors, professionals who help maximize and protect business value and personal wealth. In every interaction, we consistently maintain our clients’ confidence by remaining focused on furthering their objectives and achieving their goals in an efficient manner. Trust, knowledge, confidence—in a partner, that’s perfect.
You can connect with Offit Kurman via our Blog, Facebook, Twitter, Google+, YouTube, and LinkedIn pages. You can also sign up to receive Law Matters, Offit Kurman’s monthly newsletter covering a diverse selection of legal and corporate thought leadership content.
MARYLAND | PENNSYLVANIA | VIRGINIA| NEW JERSEY | NEW YORK | DELAWARE | WASHINGTON, DC