Dividing Property Amongst Several Owners

Tenants in Common involves allocating possession of a property amongst several different individuals. By dividing the property, each person’s property tax is lowered by a hefty amount. Furthermore, the divisions may be equal or unequal. It depends on how the participants decide to divide the property. Each may take a bedroom and share the kitchen space or one person may take half of the home while another takes the other half. It is up to the discretion of the various purchasing parties.

Such a partnership can be formed by utilization of a deed, will, or other title. Creating such a partnership also makes the owners eligible for 1031 tax deferred exchanges. This allows them to trade in their specific property area and trade it in for property with the same equity value. So theoretically, if the area under your name is worth as much as an entire home, you could trade in just the title to your area for the entire home.

Property can easily be purchased with such an ownership as easily as purchasing property by a single person. Each individual has rights to the entire property, unless it has been decided beforehand to make very specific divisions in regards to who owns what space. If one of the partners dies, the title or deed for his portion of the property is passed on according to either that person’s will or pre-devised real estate transfer plan. If no plan has been already developed, there are several options that may occur. If the deceased individual has a lawyer, the lawyer will most likely take hold of the property and attempt to auction it off and then send a portion of the money to the deceased’s family. If the person does not have a lawyer, then the other tenants can petition to have the property area divided amongst themselves.