Florida Tenancy by the Entirety

A Florida tenancy by the entirety (also called tenancy by the entireties or estate by entirety) is a special form of joint ownership that is available only to a married couple. A tenancy by the entirety treats the husband and spouse as a unit. Instead of each spouse holding a partial interest, each spouse is considered to own the entire property. Florida law provides special benefits to married that hold title as tenants by the entirety.

Benefits of Tenancy by the Entirety

Holding property as tenancy by the entirety has three important benefits under Florida law:

• Avoiding Probate – Property owned as tenancy by the entirety passes automatically to the surviving spouse upon the death of the first spouse to die. There is no need to deal with the property in probate. See Using Deeds to Avoid Probate of Real Estate in Florida for more information.
• Spousal Protection – If real estate is held in tenancy by the entirety, both spouses must sign the deed to transfer the property. A sale contract or deed by only one spouse has no effect. Similarly, both spouses are required to mortgage or otherwise pledge tenancy the entirety real estate as security. These rules protect spouses by ensuring that nothing happens to the property without their consent.
• Creditor Protection – Property held as tenants by the entirety is unavailable to the creditors of one spouse who obtain a judgment against him or her. If one spouse ends up with a lawsuit judgment, property owned as tenancy by the entirety is protected. Creditors cannot look to tenancy by the entirety property to satisfy a judgment against one spouse.

These benefits make tenancy by the entirety the most popular form of co-ownership of Florida real estate by a married couple.

Comparison of Tenancy in Common to Other Forms of Ownership

There are three ways that multiple owners can hold title to Florida real estate: tenants in common, joint tenants with right of survivorship, and tenancy by the entirety. The first two—joint tenants with right of survivorship and tenants in common—are available to anyone, regardless of marital status. Tenancy by the entirety is only available to married couples.

When choosing a form of co-ownership for multiple owners, it is important to first determine whether you want the property to pass to the surviving owner upon the death of one of the owners. Property held as tenants in common does not pass to the surviving owner upon the death of an owner. Instead, the deceased owner’s interest will pass to his or her estate to be distributed under his or her will or, if there is no will, under Florida intestacy law. In contrast, property held as either joint tenants with right of survivorship or tenancy by the entirety will pass to the surviving owner upon a deceased owner’s death. The transfer occurs automatically, without the need for Florida probate.

Creditor protection is also a significant factor when choosing the form of co-ownership. Only tenancy by the entirety provides creditor protection. This protection provides broad asset protection benefits and applies to debts other than federal tax liens. And, as mentioned above, tenancy by the entirety also provides extra spousal protection by requiring the involvement of both spouses to deal with the property.

Because tenancy by the entirety avoids probate and provides protections not provided by other forms of ownership, it is usually the best choice for married couples who purchase Florida real estate. The most common exception is when the spouses do not intend for the property to pass to the surviving spouse upon the first spouse’s death. This could be the case if one or both spouses have children that are not children of the other spouse and want those children to inherit their parent’s interest in the property. In that case, the spouses may choose to hold title as tenants in common instead of tenancy by the entirety. But if the spouses intend for the property to pass to the surviving spouse, tenancy by the entirety is usually the preferred choice over joint tenancy with right of survivorship.

Effect of Other Owners on Tenancy by the Entirety

You may not hold property as tenants by the entirety with anyone other than your spouse. This means, for example, that an unmarried couple that takes title to real estate will either hold title as tenants in common or joint tenancy with right of survivorship, depending on how the deed to the property is worded. If the deed is silent, the unmarried couple is assumed to hold title as tenants in common.

If someone other than the married couple will own an interest in the property, care must be taken to preserve tenancy by the entirety status. When there is a deed to more than two people and two of them are married, the deed should be carefully worded spell out how the interests will be allocated.

Example: A husband and wife are purchasing an investment property with their son. Because the law treats the husband and wife as a unit, the husband and wife will own a one-half interest in the property as tenants by the entirety unless the deed specifies otherwise. The son will own the remaining interest, either as tenant in common or joint tenant with right of survivorship, depending on the language of the deed.

Effect of Homestead on Tenancy by the Entirety

Florida homestead law provides special spousal protections for homestead property. Specifically, one spouse cannot convey homestead property without the signature of the other spouse. But the Florida Constitution provides an important exception to this rule: A married may convey real estate by deed to his or her spouse to create a tenancy by the entirety with the spouse. This is often necessary when a person acquires property before he or she is married and later wants to add his or her spouse to the deed.

Even though the signature of the spouse is not technically required to convey property to a spouse as tenancy by the entirety, the Florida Bar recommends that both spouses sign the deed transferring the property to the surviving spouse. (This position is reflected in the Florida Real Property Sales Transactions guide by the Florida Bar Continuing Legal Education members.) There is no downside to having the spouse sign the deed, and doing so resolves any questions about whether the property was effectively conveyed.

Florida’s complicated rules governing the handling of homestead property after one spouse’s death do not apply to property owned in tenancy by the entirety. This is so even if the surviving spouse disclaims the property when it passes to him or her.

How to Create a Tenancy by the Entirety

There are several requirements for creating a tenancy by the entirety. In addition to the requirement that the couple be married:

• The interest of the husband and the wife in the property must begin at the same time;
• The husband and the wife must receive title in the same deed or other instrument;
• The husband and the wife must receive the same interest; and
• The husband and the wife must have equal right to control or possess the property.

These requirements are usually satisfied if the couple is receiving their interest in the property from someone else by deed. A deed or other conveyance to a husband and wife will be presumed to create a tenancy by the entirety unless some other intent is shown.

If the tenancy by the entirety is created by one spouse transferring property to both spouses as tenancy by the entirety (for example, adding a spouse’s name to a deed), the spouse that currently owns the property only needs to convey the property to himself or herself and to his or her spouse. It is important to transfer the entire interest in the property and not to make the common mistake of transferring only a one-half interest. The deed should transfer the entire property from the transferring spouse to both spouses as tenants by the entirety.

Marriage is an essential requirement of tenancy by the entirety. If a married couple takes title as tenancy by the entirety and later divorces, the tenancy by the entirety will change to tenancy in common. Both the husband and the wife will become tenants in common with each other with undivided interests in the entire property. As a result, the protections offered by tenancy by the entirety will disappear. Upon the death of one of the owners, his or her interest will pass to his or her estate instead of to his or her ex-spouse.