Tenancy By Entireties Protection Different In Some Other States

Tenants by the entireties protection from creditors is not the same in all states. Some states do not recognize the concept of tenancy by entireties ownership between married couples. Some states recognize entireties ownership of real property but not personal property. A client today claimed that a parcel of real property he owned in another state was protected from his individual creditors because the deed said it was owned as tenants by entireties. When I researched the laws of the state in question I found that the state laws did recognize entireties ownership of real property. However, the ownership had asset protection consequences different from Florida law.

In Florida, tenancy by entireties real property and personal property is completely exempt from the creditors of either spouse. The laws of my client’s state were different. The state’s case law held that entireties property is exempt from forced sale, but that a creditor could still put a lien on the debtor’s interest in the entireties property. When the entireties ownership terminates by divorce or by the spouse’s death the creditor can foreclose its lien against the debtor’s interest. Just because you own property in a state that recognizes entireties ownership do not assume that your property has the same degree of asset protection afforded to entireties assets by Florida’s laws.

posted by Jonathan Alper, asset protection and bankruptcy attorney, Orlando, Florida