By Associate Attorney Danielle Nodar
If you live in North Carolina and are married, one of the benefits available to you is a type of property ownership known as Tenancy by the Entirety (TBE). TBE is a type of real estate ownership where the marital unit, not the individual spouses, own the property. This means that one party to the marriage cannot sell or borrow against the property without the consent of the other party.
The main benefit of TBE ownership is asset protection, as the creditors of one spouse cannot attach a lien or judgment against the TBE property. For example, if a spouse has a $10,000 judgment against him or her, the creditor will be unable to attach a judgment lien against the TBE property. This is a great way for protecting real estate from a creditor, particularly if one spouse is involved in a business or occupation where there may be a higher risk of being sued. The only exception is that federal tax liens against one spouse will attach to that spouse’s interest in the TBE property.
TBE ownership can also be an important estate planning tool as it includes survivorship rights. If one spouse passes away, the title of the TBE property automatically passes to the surviving spouse without going through probate. Also, as ownership of the property is automatic for the surviving spouse, one spouse cannot convey TBE property in their individual will or trust to a non-spouse.
It is important to remember that a couple must be married at the time they acquire the real estate to get TBE protection. For example, if a couple owns a house together before marriage and then gets married, the property will not automatically become TBE property. As strange as this sounds, to gain the benefits of TBE ownership, the couple would need to sign a new deed transferring the property from themselves individually to themselves as a now-married couple.
As TBE provides that the marital unit owns the property, it can be terminated under certain circumstances that impact the marriage, such as divorce or death of a spouse. If a divorced spouse or the surviving spouse has a judgment against them, it will then attach to their interest in the property.
If you have any questions about how TBE can be used in estate planning or asset protection, please call Jesson & Rains!
By Associate Attorney Katy Currie
An assumed business name, also referred to as a fictitious name or “doing business as” (“DBA”), is when a business operates under a different name than the name registered with the North Carolina Secretary of State’s Office (for example, Jesson & Rains, PLLC, doing business as Jesson Law Group). Think of an assumed business name as a “nickname” for your business. Keep in mind, an assumed business name is just a “nickname” for your business and not a separate business itself.
North Carolina law allows businesses to operate under assumed business names if it appropriately files an assumed business name certificate with the local register of deeds office. The certification puts the world on notice that the business is being operated under a different name. The assumed business name certificate only needs to be filed in one of the counties in which the business will engage in business, as long as you indicate that you plan to do business in all 100 counties on the certificate.
Why operate under an assumed business name? Some businesses may want to create a catchier, shortened version of its business name for marketing or branding purposes, or maybe it simply wants a new business name. Sometimes businesses decide to start a separate “branch” of the business without forming a completely new business. For example, if you are a photographer, and you decide to do videography, you may file for an assumed name for the videography business instead of forming a second business that then has to file a separate tax return, get a second EIN number, and separate bank accounts. However, you should not go this route if separation of the two businesses is good from a liability protection standpoint. A creditor of the videography business is a creditor of the photography business, and vice versa. The only way to avoid that is to form two separate businesses.
Businesses need to be careful when using assumed business names to not infringe on any trademarks. A business should conduct a name and trademark search before filing the assumed name certification.
For assistance or for more information regarding assumed business names, or about your business in general, please don’t hesitate to reach out to Jesson & Rains!
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