The Pitfalls of Adding Adult Children to Title as an Estate Planning Technique

Over the years, I have been asked by many aging parents if they should add their adult children as joint tenants on their homes, bank accounts and/or investment accounts. In almost every instance, I responded with a resounding “no.” While adding an adult child to title may be a simple and inexpensive estate planning technique that ensures your child will receive those assets upon your death without having to go through probate, it is rarely advisable for the following reasons (among others):

Loss of Ownership & Control

If you are adding your adult child to the title of your house or accounts for estate planning purposes, it is most likely intended to ensure they will receive the property upon your death. Adding the child to title, however, gives them an immediate ownership interest in the property equal to your own. This means, among other things: (1) they have access to your accounts and can withdraw any and/or all funds from the accounts (temporarily or permanently) during your lifetime without your consent; (2) you will not be able to sell more than your 50% share of your real property without their cooperation; (3) you cannot change your mind and take title to your real property back without their agreement and participation; (4) they can transfer or sell their 50% interest in the real property to someone else during your lifetime without your permission; and (5) they can defeat the right of survivorship during their lifetime and leave their half of the property to someone else so that if they predecease you, you will own the property with whomever they named as their beneficiary.

Creditor Exposure

Property held jointly is subject to claims by creditors of any and all owners of the property. If you add your adult child as a joint tenant or joint account holder, your assets will be exposed to the claims of that child’s current and future creditors. If they get into an accident, are sued for any other reason, or file for bankruptcy, for example, your estate could be in jeopardy.

Unintended Gift Tax Consequences

Adding your child to title to your home constitutes a taxable gift equal to one-half of the value of the property. While in most cases, a tax will not be due, you will be required to file a gift tax return (Form 709) for the year in which the gift is made.

Unintended Results & Family Discord

Many aging parents – even those who do have estate plans – add an adult child as a joint account holder to a bank account to give that child access to funds in case of an emergency and/or to assist the parent with bill paying during the parent’s lifetime. When the parent dies, the account will be transferred to the joint account holder regardless of what the parent’s Will or Trust says; the title on the account governs its disposition. Suppose the parent had a Will and/or Trust that says the estate shall be distributed equally to the parent’s three children. The parent’s intentions will not have been met. This can cause unintended discord among family members. 

For more information on the pitfalls of joint tenancy and to explore better estate planning options, contact Laura Adell at Adell Law Offices. She can be reached by telephone at (818) 883-9272 or by email at