If you have assets in Florida, you need to know the best way to avoid exposure and keep them protected from potential creditors. Tenants by Entireties (or Tenancy by the Entireties or “TBE”) is a great option for creditor protection for married couples because it is relatively simple to setup or form. In other words, there is little legal work or expense. By a married couple holding property as Tenants by Entireties, a creditor of one spouse alone cannot levy or invade a jointly owned Tenants by Entireties asset.
This exemption is non-statutory and is founded upon case law in Florida. It can apply to most property such as real estate, personal property, bank accounts, investment accounts, business interests, etc. It is uniquely different than other forms of joint ownership, namely Tenants in Common or Joint Tenants with Right of Survivorship. Tenancy by Entireties is joint ownership with the right of survivorship, but pertains only to married couples, including same-sex spouses.
The Florida Supreme Court has long held that entireties property possesses six characteristics: (1) unity of possession (joint ownership and control); (2) unity of interest (the interests in the account must be identical); (3) unity of title (the interests must have originated in the same instrument); (4) unity of time (the interests must have commenced simultaneously); (5) survivorship; and (6) unity of marriage (the parties must be married at the time the property became titled in their joint names). In Florida, jointly owned marital property is presumed to be intended to be held as Tenants by Entireties.
Issues can arise where an asset was originally held or setup in another state that does not recognize Tenants by Entireties property and then the married couple moves to Florida. Another issue to consider is that by naming certain assets that may cause liability such as a vehicle as joint property, that can also create a joint liability. Furthermore, sometimes jointly titling assets is contrary to the estate or personal planning goals for a married couple.
There are four main exceptions to the Tenants by Entireties creditor protection exemption:
If you are still unclear on whether to hold your joint assets as Tenants by Entireties, whether an asset qualifies as entireties property, or if you are in search of other asset protection options, contact an experienced Asset Protection Attorney.