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SB 920 - This act specifies what happens to a certain kind of property, known as tenancy by the entireties property, when it is transferred to a particular kind of joint revocable trust created by a husband and a wife. The act specifies that property owned as tenants by the entirety still has the characteristics of tenancy by the entireties property when it is transferred to a joint revocable trust. After the tenancy by the entireties property is transferred to the trust, it will be protected from the individual creditors of the husband and the wife, but not joint creditors of both the husband and the wife, in the same way that tenancy by the entireties property is protected from creditors. Tenancy by the entireties property transferred to the trust will be considered quasi-community property, and upon the death of the first spouse, the surviving spouse will be entitled to a stepped-up basis for estate tax and income tax purposes. Any individual property owned by a husband or wife will be considered to be converted to tenancy by the entireties if it is put in a certain type of joint revocable trust. A trustee is not prohibited from acquiring, selling, disposing of, or transferring any tenancy by the entireties property, without the consent of the other trustee, unless the trust agreement requires the consent of both trustees, without affecting the designation of the trust property as tenancy by the entireties property. If the transfer of tenancy by the entireties property to the trust is invalidated, the trust is dissolved, or the trust agreement is revoked, the property will automatically be considered to be held by husband and wife as tenancy by the entireties property. EMILY KALMER
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