1. Ways to Hold Title in Arizona

2. Overview Married persons Groups of people Lenders or other beneficiaries

3. Community Property All property acquired by husband and wife is presumed to be community property Requires valid marriage Each spouse holds an undivided interest in the estate One spouse cannot partition the property by selling his or her interest

4. Community Property (cont.) Requires signatures of both spouses Each spouse can will one half of the community property Upon death, the estate of the decedent must be cleared through probate, affidavit or adjudication Both halves of the community property are entitled to a “stepped up” tax basis as of the date of death

5. Community Property with Right of Survivorship Co-ownership by husband and wife providing for the surviving spouse to retain full title after the death of the other spouse Requires valid marriage Estate passes to the surviving spouse outside probate − no court action required to “clear” title

6. Community Property with Right of Survivorship (cont.) Each spouse holds an undivided one-half interest in the estate One spouse cannot partition the property by selling his or her joint interest Requires signatures of both spouses to convey or encumber Both halves of the community property are entitled to a “stepped up” tax basis as of the date of death

7. Joint Tenancy with Right of Survivorship (multiple persons) Parties need not be married; may be more than two joint tenants Estate passes to surviving tenant(s) outside of probate − no court action required to “clear” title Each joint tenant holds an equal and undivided interest in the estate

8. Joint Tenancy with Right of Survivorship (cont.) One joint tenant can partition the property by selling his or her joint interest Requires signatures of all joint tenants to convey or encumber the whole Deceased tenant’s share is entitled to a “stepped up” tax basis as of date of death

9. Tenants in Common (multiple persons) Parties need not be married; may be more than two tenants in common Each tenant in common holds an undivided fractional interest in the estate (may be disproportionate) Each tenant’s share can be conveyed, mortgaged or devised to a third party

10. Tenants in Common (cont.) Upon death, the tenant’s proportionate share passes to his or her heirs by will or intestacy (must be cleared through probate, affidavit or adjudication) Each share has its own tax basis

11. Sole and Separate (married individual only) Real property owned by a spouse prior to marriage or acquired after marriage by gift or devise, descent or specific intent When married person acquires title as sole and separate property, spouse must execute a disclaimer deed