Problem 1 — Joint Tenancy Must Be Expressly Created, and Most People Get It Wrong
Georgia does not default to joint tenancy. Under O.C.G.A. § 44-6-190, any deed naming two or more persons is presumed to create a tenancy in common under O.C.G.A. § 44-6-120 — unless the instrument expressly uses language such as “joint tenants,” “joint tenants with right of survivorship,” or “joint tenants and not as tenants in common.”
A deed that says “to John Smith and Mary Smith” creates a tenancy in common, not a joint tenancy. There is no automatic right of survivorship. When John dies, his half-interest does not pass automatically to Mary — it passes through his estate.
Many Georgia investors who believe they created a joint tenancy did not. They added a name to the deed without using the required survivorship language. When they die, the property goes through probate, defeating the entire purpose.
Even for investors who do get the language right: a joint tenancy can be severed — converted back into a tenancy in common — by any single joint tenant acting alone, without the other’s knowledge or consent. One joint tenant who conveys their interest to a third party, or who records a deed of severance, ends the joint tenancy immediately. The survivorship benefit can disappear without warning.
Problem 2 — It Only Avoids Probate Once
Joint tenancy with right of survivorship bypasses probate at the first owner’s death. The surviving joint tenant takes full ownership automatically, by operation of law, at the moment of death. No court, no petition, no waiting period.
That is the full extent of what joint tenancy does.
When the surviving owner later dies, they hold the property as an individual. The survivorship mechanism is gone — it was consumed at the first death. The property passes through their estate and goes through probate, subject to the full timeline (8 to 18 months for an uncontested Georgia estate), attorney fees, executor commissions under O.C.G.A. § 53-6-60, and court supervision.
For a Georgia investor who adds a child as joint tenant to avoid probate, the outcome is: probate skipped at the investor’s death, probate required at the child’s death — unless the child has done separate estate planning before they die. Joint tenancy transfers the probate problem to the next generation. It does not eliminate it.
A revocable trust holds title indefinitely, through multiple generations of ownership succession, without any probate event. For an investor with a multi-property portfolio, a trust is the only structure that addresses the second death.
For what probate actually costs when it runs on a rental property estate, see How Much Does It Cost When Georgia Rental Properties Go Through Probate.
Problem 3 — One Incapacitated Owner Blocks Every Transaction
Every conveyance of Georgia real property requires the signature of every owner. This is not a formality — it is the legal requirement for a valid deed.
In a joint tenancy, both joint tenants must sign to sell, refinance, or encumber the property. If one joint tenant is incapacitated — stroke, dementia, accident — and cannot sign, the other joint tenant cannot proceed with any transaction without court authorization.
Without a durable power of attorney that the title company and lender will accept, or a properly established conservatorship, the property is frozen. The investor who added a spouse or child as a joint tenant for simplicity has created a structure where one health event locks the entire asset.
A revocable trust solves this directly: the successor trustee steps in immediately upon incapacity, with no court involvement, and can execute any transaction the trust authorizes.
Problem 4 — A Co-Owner’s Creditors Can Reach the Property
When one joint tenant has a judgment against them, a creditor can record a Writ of Fieri Facias (FiFa) with the superior court clerk in the county where the property is located under O.C.G.A. § 9-12-86(b). That recording attaches the lien to the debtor’s interest in the property.
The creditor can then sever the joint tenancy — converting it into a tenancy in common — and pursue a forced sale through the partition process under O.C.G.A. § 44-6-160. The other joint tenant’s interest goes to auction to satisfy a debt they did not incur. The co-owner does not need to have done anything wrong. The liability belongs to the debtor joint tenant alone — but the property is not protected from it.
This exposure is not limited to judgment creditors. A joint tenant who files for bankruptcy places their interest in the bankruptcy estate. The bankruptcy trustee can seek to liquidate the debtor’s interest in real property, which in a joint tenancy context means forcing a sale of a property the other owner never intended to sell.
Trust beneficiaries hold equitable interests — not legal title. A creditor of a trust beneficiary cannot attach a lien to trust property or force a sale of trust assets to satisfy that beneficiary’s personal debts.
For more on what happens when co-owners disagree or creditors become involved, see What Happens When Heirs Disagree About Rental Properties in Georgia.
Problem 5 — Adding a Child as Joint Tenant Is a Taxable Gift With a Basis Penalty
When an investor adds an adult child as a joint tenant on a rental property deed, they are making a gift of a fractional interest in the property. Under IRC § 2511, that gift is subject to federal gift tax rules.
If the gifted interest exceeds the annual exclusion ($18,000 per recipient in 2024), the excess must be reported on Form 709 and applied against the investor’s lifetime gift and estate tax exemption. For a rental property worth $500,000, adding a child as a 50% joint tenant is a $250,000 gift — far above the annual exclusion, requiring Form 709 filing.
The basis consequence is equally significant. Under IRC § 1014, assets inherited at death receive a stepped-up basis — the heir’s cost basis resets to fair market value on the date of death, eliminating capital gains tax on appreciation that occurred during the decedent’s lifetime. Under IRC § 1015, assets received by gift carry over the donor’s original cost basis. There is no step-up on gifted property.
When an investor adds a child as joint tenant, they gift half the property now. That half carries a carryover basis. When the investor later dies, only their remaining half gets the stepped-up basis under § 1014. The child’s half — received as a gift — retains the investor’s original cost basis. If the child later sells the property, they owe capital gains tax on the appreciation across both halves, minus the step-up on the inherited portion only.
An investor who instead holds the property in a trust and leaves it entirely to the child at death gets a full step-up on the entire property under § 1014. The difference in capital gains tax exposure across a $500,000 property with decades of appreciation can easily exceed $50,000–$100,000.
What a Trust Does Instead
A revocable living trust eliminates all five problems.
Probate: The trust holds title indefinitely. At the investor’s death, the successor trustee takes over — no probate at the first death, no probate at the second, no probate at any generational transfer.
Incapacity: The successor trustee takes over immediately upon incapacity. No conservatorship. No court. No frozen transactions.
Creditor protection: Trust property is not reachable by a beneficiary’s personal creditors. The legal separation between the trust and its beneficiaries is what creates that protection.
Tax basis: When the trust passes the property to beneficiaries at death, the entire asset receives a stepped-up basis under IRC § 1014 — no partial carryover, no gift tax reporting.
Distribution control: The trust document specifies exactly when, how, and to whom the property or its proceeds are distributed. The investor sets those terms. A joint tenancy gives the surviving owner everything, immediately, with no conditions attached.
For a full overview of the structure that addresses all five problems, see Best Way to Hold Rental Properties in Georgia for Estate Planning.
