Who Gets the House When Your Spouse Dies

Real estate can be complicated, especially when it comes to inheriting. What you put in your will and what happens after you die could be completely different.

Making a Will in Ontario

The grief dying without a will causes spouses and families is immeasurable. As if the shock of a sudden death isn’t enough, not knowing what your loved one intended to do with their assets is frustrating and confusing. When that asset is expensive real estate, it’s even more so.

Dividing the Matrimonial Home

Matrimonial homes — where you spent most of your time as a couple — get special treatment under family law when you divorce or separate. Wills and estate planning is much the same. Deciding who gets the matrimonial home or homes after death is the biggest decision you may make when it comes to your final will and testament.

Disposing of Single Owner Property

Real estate you own yourself, as a single or divorcee, is fairly easy to dispose of. You can will it to anyone you want or arrange to have it sold by your estate trustee or personal representative. Any profit from the sale after expenses can go to your estate, heirs or a charity of your choice.

Inheriting Jointly Owned Property

You might have agreed to put both your names on the property title when you bought your matrimonial home or other real estate. That’s known as joint tenancy. Being joint tenants gives you legal rights to sole ownership of the property after your spouse passes away. The “right of survivorship” is automatic, meaning you don’t have to go through probate court to get it. Even if your spouse left the property to someone else in their will, as long as you were joint tenants in life, you inherit their share after they pass on.

When Joint Tenants Are On Title

Survivorship rights only apply if you and other property owners have equal shares, throughout the time you owned it. If family or investors have partial shares, they are tenants in common with you. Property held by tenants in common goes through probate court, like other assets in a personal will. The share owners must wait for the estate trustee, or the province if you died intestate without a will, to distribute your property and possessions. Any bare land you own will be presumed to be a tenant in common property, unless you specifically created a joint tenancy. Check with a real estate lawyer if you are unsure. 

Property Passes Outside Estate

When you name a beneficiary to a mutual fund, it passes outside your estate when you die. Your heir doesn’t have to wait for your will to be distributed by your estate trustee. They inherit the fund automatically. The same happens in joint tenancy.

Why Survivorship Benefits You

A survivorship applications takes only days to process. Survivorship gives you the right to occupy and own jointly held property immediately. Instead of your deceased spouse’s will winding its way through court for months or years, you can remain in the home, sell or rent it as you see fit. Surely your life partner would want it that way

Filing a Survivorship Application

Acting quickly is important because until you file a survivorship application, the home can’t be sold, mortgaged, leased or rented after your spouse’s death. That’s because your spouse’s name is still on the property title. A wills and estates lawyer must update the title to get legal access to the property.

Registering Your Survivorship Application

Ask your wills and estates lawyer to prepare and register the survivorship application for you. You will need the original death certificate from the funeral home or a certified true copy, available through a notary public. Your lawyer will search the property title and prepare the paperwork for you to sign. The application will be registered with the Province of Ontario to ensure their records are up to date.

Tax Implications for Joint Tenants

Provided the home was your spouse’s principal residence, their estate will avoid any taxes on increases in the value of the property since the home was acquired. After you become sole owner, you will be liable for taxes on future property value increases. How much tax you pay will depend on whether it is  your principal residence, second home or income property.  

Changing Your Tenancy Status

You and your spouse can change your tenancy status at any time by severing your agreement. Severance can also occur if both joint tenants die, either at the same time or when the surviving tenant passes away. Unlike taxes, nothing is forever when it comes to your home.

Joint Tenancy Legal Advice for Ontario Owners

Organize your personal will and final estate to arrange joint tenancy. Axess Law Ontario wills and estates lawyers can meet with you by remote video call or in person. Use our online booking form to make a video call appointment or dial toll-free to 1-877-522-9377 or in Greater Toronto at 647-479-0118. In person appointments are available at our Ottawa, Toronto, Scarborough, Vaughan, Etobicoke, Mississauga Winston Churchill or Mississauga Heartland law offices.

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