We Alaskans pride ourselves on being independent. But despite our “we don’t give a darn how they do it Outside” attitude, most of our state laws are the same as just about everywhere else in the U.S.
One reason is that many of those laws are tightly governed by federal law (such as Medicaid, which is based on state statutes, but those statutes have to meet federal requirements if the program is going to be funded). But even beyond that, an awful lot of our statutes are written elsewhere. When the state was new, for instance, they borrowed a lot of laws from Oregon, and many of those are still on the books. And from what I have seen, there are probably more uniform acts and model laws adopted in Alaska than in any other state.
But there is one area where Alaska stands out. I’m not sure it’s such a good thing that it does.
In every state but ours, you can hold real estate as “joint tenants with right of survivorship.” Okay, in fairness I have not researched all 49 other states on this, but every state that I have looked at allows that sort of ownership. In Alaska, we don’t.
What joint tenancy means is that when one of the people on that piece of property dies, the other one automatically gets the property. No probate necessary, it’s just automatic.
Ah, you say, that can’t be right. We allow that! I know somebody in Alaska whose husband died, and they owned their home together, and she automatically got it when he died. Yes, you can indeed do that, but it has a different name. That is called “tenants by the entireties,” and it only works for a husband and wife. If you’re not legally married to each other, you can’t hold property with somebody, and have those automatic survivorship rights.
In another state, I could hold a piece of land as a joint owner with my adult child. Or my significant other. Or my siblings – in farm country it is quite common to see the family farm left to a bunch of brothers and sisters, with right of survivorship between them. But I can’t do that here.
If I try to create a joint tenancy between two people who are not married to each other in Alaska, I end up creating the other kind of joint ownership, which is called “tenants in common.” When two people hold real estate as tenants in common, there is no survivorship right. Let’s say I own a rental property, as tenants in common with my daughter. When I die, she won’t own the property. She will still own her half, but the other half belongs to my estate. And that means it has to go through probate.
I have seen a number of cases where that caused a problem, and most of them involved a boyfriend and girlfriend owning their home together. When the boyfriend died, the girlfriend thought she owned the property. She didn’t. It had to go through probate, and worse yet, if the boyfriend didn’t leave a will which named the girlfriend as his heir, half of the property was going to his relatives. Who of course wanted to sell the property. You can imagine how ugly some of those cases got.
It is an odd exception to the norm that we have. However as of two years ago, there is a solution. That is when the legislature passed a law allowing transfer-on-death deeds. So now, while the owners of that common property cannot automatically inherit, they can each do a transfer-on-death deed to the other, which effectively accomplishes the same thing. When one of them dies, the other one immediately gets the property.
Unfortunately people don’t know this. Particularly if they come from other states, where joint ownership between non-spouses is allowed, they may just quitclaim a piece of real estate to themself and somebody else, thinking that alone solves the problem.
So if you own a piece of real estate in Alaska with somebody else, and you’re not married to each other, see a lawyer right away. That could be an expensive mistake.
Kenneth Kirk is an attorney and estate planner in Anchorage. This article should not be taken as legal advice; for specific legal advice you should consult an attorney.
