Tenancy by the Entirety Available to Trusts

You can still have the protection of tenancy by the entirety even if your home is in a trust.

Illinois allows spouses to hold their primary residence by what is called “tenancy by the entirety.” Like joint tenancy, tenancy by the entirety allows one spouse to automatically inherit the marital home without having to go through probate. Tenancy by the entirety, however, also provides protection in the event that one spouse (but not both) is sued.

When a creditor receives a judgment against someone, the creditor may attach that judgment to any property the debtor owns, even that owned jointly with someone else. (See our earlier post here for an example of that.) The creditor can then foreclose against the property, causing it to be sold to pay the judgment. While tenancy by the entirely cannot prevent a creditor from attaching a judgment against your home, it does prohibit the creditor from selling the home as long as the tenancy remains in effect and the property is the primary marital residence.

It used to be that property had to be held directly by the owners in order to qualify for tenancy by the entirety. That is, a couple could not take advantage of tenancy by the entirety if their home was held in trust. Recently, however, the legislature amended the Joint Tenancy Act to allow couples to do just that–keep the tenancy by the entirety notwithstanding their home being held in trust as part of their estate plan.

Business owners who are married should take advantage of the protection of tenancy by the entirety to protect their spouse from potential creditors. Contact us today to learn how to make sure your real estate is being held in a way to provide your family the greatest protection in your estate plan.


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Charles Wentworth
Charles Wentworth
Charles Wentworth
Charles is an attorney in Glen Ellyn, Illinois. After graduating from the University of Utah, he clerked for Chief Justice John T. Broderick of the New Hampshire Supreme Court. He then became a litigation associate at Kirkland & Ellis LLP before opening his own office and partnering with Rick Lofgren. He lives just outside of Chicago, where he participates in community activities, including Boy Scouts and little-league baseball.