Tenancy In Common (TIC) Explained: How It Works and Compared to Joint Tenancy (2024)

What Is Tenancy in Common (TIC)?

Tenancy in Common (TIC) is a legal arrangement in which two or more parties share ownership rights in a real estate property or parcel of land. Each independent owner may control an equal or different percentage of the total property, whether commercial or residential. The parties are known as tenants in common.

Tenancy in Common is one of three types of shared ownership. The other two types are Joint Tenancy and Tenancy by Entirety. A TIC has no right of survivorship and when a tenant in common dies, their share of the property passes to their estate, where a beneficiary of the share of property may be named.

Key Takeaways

  • Tenancy in Common (TIC) is a legal arrangement in which two or more parties have ownership interests in a real estate property or parcel of land.
  • Tenants in common can own different percentages of the property.
  • Tenants in common can bequeath their share of the property to a named beneficiary upon their death.
  • Joint Tenancy and Tenancy by Entirety are two other types of ownership agreements.

How Tenancy in Common (TIC) Works

Owners as tenants in common share interests and privileges in all areas of the property, however, each tenant can own a different percentage or proportional financial share of the property.

Tenancyin Common agreements can be created at any time and an individual may join as an interest in a property after the other members have already entered into a TIC arrangement. Each tenant can also independently sell or borrow against their portion of ownership.

While the percentage of the property owned varies, a tenant in common cannot claim ownership to any specific part of the property.

Dissolving Tenancy in Common

One or more tenants can buy out other members to dissolve the Tenancy in Common in a joint agreement. In cases where an understanding cannot be reached, a partition action may take place that may be voluntary or court-ordered.

In a legal partition proceeding, a court will divide the property as a partition in kind, separating the property into parts that are individually owned and managed by each party without compelling a person to sell his property against his will.

If the tenants refuse to work together, they may consider entering into a partition of the property by sale. In this case, the holding is sold and the proceeds are divided among the tenants according to their respective share of the property.

Property Taxes Under Tenancy in Common

Because a Tenancy in Common agreement does not legally divide a parcel of land or property, most tax jurisdictionswill not separately assign each owner a proportional property tax bill based on their ownership percentage. Most often, the tenants in common receive a single property tax bill.

In many jurisdictions, a TIC agreement imposes joint-and-several liability on the tenants where each of the independent owners may be liable for the property tax up to the full amount of the assessment. The liability applies to each owner regardless of the level or percentage of ownership.

Tenants can deduct payments from their income tax filings. If the taxing jurisdiction followed joint-and-several liability, each tenant can deduct the amount they contributed. In counties that do not follow this procedure, they can deduct a percentage of the total tax up to their level of ownership.

Joint Tenancy and Tenancy by Entirety

Besides Tenancy in Common, two additional forms of shared ownership are commonly used: Joint Tenancy and Tenancy by Entirety.

In a Joint Tenancy, tenants obtain equal shares of a property with the same deed at the same time. With two tenants, each owns 50%. If one party would like to buy out the other, the property must be sold and the proceeds distributed equally.

In Tenancy in Common, the ownership portion passes to the individual's estate at death. In Joint Tenancy, the title of the property passes to the surviving owner.

Some states set Joint Tenancy as the default property ownership for married couples, while others use the Tenancy in Common model. A third method, used in some states, is Tenancy by Entirety in which each spouse has an equal and undivided interest in the property.

In Tenants by Entirety, both parties have equal, 100% interest in the property as if each is a full owner. If a married couple is in a TBE agreement, the property is viewed as owned by one entity.

Contract terms for Tenancy in Common are detailed in the deed, title, or other legally binding property ownership documents.

Pros and Cons ofTenancyin Common

Buying a home with a family member or business partner may make it easier to enter the real estate market. Dividing deposits, payments, and maintenance make real estate investment less expensive for an individual buyer.

However, when mortgaging property as tenants in common, all borrowers sign and agree to the loan agreement, and in the case of default, the lender may seize the holdings from all tenants. If one or more borrowers stop paying their share of themortgage loan payment, the other borrowers are still responsible for the full payment of the loan.

Using a will to designate beneficiaries to the property gives a tenant control over their share. However, the remaining tenants may subsequently own the property with someone they do not know or with whom they do not agree. The heir may file a partition action, forcing unwilling tenants to sell or divide the property.


  • Facilitates property purchases

  • Number of tenants can change

  • Different degrees of ownership possible


  • No automatic survivorship rights

  • All tenants equally liable for debt and taxes

  • One tenant can force sale of property

Example of Tenancy in Common

California allows four types of ownership that include Community Property, Partnership, Joint Tenancy, and Tenancy in Common. TIC is the default form among unmarried parties or individuals who jointly acquired property.

These owners have the status of tenants in common unless their agreement or contract expressly states otherwise as a Partnership or Joint Tenancy.

TIC is one of the most common types of homeownership in San Francisco, according to SirkinLaw, a San Francisco real estate law firm specializing in co-ownership. They maintain that TIC conversions have become increasingly popular in other parts of California too, including Oakland, Berkeley, Santa Monica, Hollywood, Laguna Beach, San Diego, and throughout Marin and Sonoma counties.

What Benefit Does Tenancy in Common Provide?

Tenancy in common (TIC) is a legal arrangement in which two or more parties jointly own a piece of real property, such as a building or parcel of land. The key feature of a TIC is that either party can sell their share of the property while also reserving the right to pass on their share of the property to their heirs.

What Happens When One of the Tenants in Common Dies?

The ownership share of the deceased tenant is passed on to that tenant’s estate and handled in accordance with the deceased tenant’s will. Any surviving tenants continue owning and occupying the property.

What Is a Common Dispute Among Tenants In Common?

TIC tenants share equal rights to use the entire property regardless of their ownership percentage of the property. Maintenance and care are divided evenly despite ownership share. Problems often arise when a minority owner overuses or misuses the property.

The Bottom Line

Tenancy in Common is one of three types of ownership where two or more parties, referred to as tenants in common, share interests in real estate or land.Owners as tenants in common share interests and privileges in all areas of the property regardless of each tenant's financial or proportional share of the property. Two other types of ownership agreements are Joint Tenancy and Tenancy by Entirety.

Tenancy In Common (TIC) Explained: How It Works and Compared to Joint Tenancy (2024)


Tenancy In Common (TIC) Explained: How It Works and Compared to Joint Tenancy? ›

In a tenancy in common, co-owners can own unequal percentages and can choose who will inherit their shares upon death. By contrast, with the type of co-ownership

Co-ownership is a legal concept in a business where two or more co-owners share the legal ownership of property. For the concept of co-ownership in different legal codes, see: Concurrent estate, for co-ownership in the common law system.
https://en.wikipedia.org › wiki › Co-ownership
called joint tenancy, each co-owner must own an equal share and the share automatically passes to the other co-owners upon death.

What is the difference between a tenancy in common and a joint tenancy? ›

To sum up: joint tenants must receive their property interest simultaneously and from the same source and must have an equal share with equal right to possess the entire property. On the other hand, tenants in common can receive their interest at different times and sources and don't have to possess equal shares.

What is the main difference between a tenancy in common and a joint tenancy quizlet? ›

What is the difference between tenancy in common and joint tenancy? c. Tenancy in common is an inheritable estate; joint tenancy is characterized by the right of survivorship.

What right distinguishes a joint tenancy from a tenancy in common? ›

The difference between a joint tenancy and tenancy in common is significant. Under a joint tenancy with rights to survivorship, upon the death of the first owner, it automatically passes to the surviving owner. In a tenancy in common situation, you each own 50% of the property.

How to tell the difference between tenants in common and joint tenants? ›

When buying a property together, unmarried couples have a choice over whether to register with the land registry as joint tenants or as tenants in common. In short, under joint tenancy, both partners jointly own the whole property, while with tenants-in-common each own a specified share.

What is the downside of tenants in common? ›

Disadvantages of Tenants in Common

Another drawback to tenancy in common is that property held in this manner rarely bypasses probate, unless it is being disposed of through a trust. This is because every tenant has an undivided fractional interest in the property, which they can transfer to whomever they please.

What is the primary advantage of being a joint tenant with the right of survivorship? ›

Joint tenants with right of survivorship is a legal term for a way to own assets jointly, where two or more parties have equal rights and ownership of an account or real estate. If one owner dies, the surviving owners automatically get full ownership of the asset.

What are the biggest differences between joint tenant and tenant in common vesting? ›

A critical difference between tenancy in common and joint tenancy is the absence of the "right of survivorship" in a tenancy in common when a tenant in common dies, their interest in the property passes to their heirs or designated beneficiaries, as outlined in their will or state intestacy laws, rather than ...

What is a tenancy in common best described as? ›

A tenancy in common (TIC) is one of three types of concurrent estates (defined as an estate that has shared ownership, in which each owner owns a share of the property). The other two types are a joint tenancy and a tenancy by the entirety. A TIC typically has no right of survivorship.

When a joint tenant dies, what happens to the tenant's interest in the estate? ›

The property interests of other kinds of co-owners, like tenants in common, for example, are typically passed on to heirs or to creditors of the deceased person. But in a joint tenancy, the deceased person's interest in the property only passes to the living cotenants.

What right does joint tenancy have unlike a tenancy in common? ›

A joint tenancy agreement features what is known as right of survivorship. Essentially, a right of survivorship states that should one named party die, the remaining party or parties automatically assume full ownership. A right of survivorship eliminates any need for probate.

What feature most distinguishes a joint tenancy from a tenancy? ›

Joint tenants can be at the property at any time, either together or separately. The key feature that distinguishes joint tenancy from other types of ownership rights is that the surviving joint tenant(s) acquires the shares held by another tenant upon their death.

Which tenancy is best for married couples? ›

The most recognized form for a married couple is to own their home as Tenants by the Entirety. A tenancy by the entirety is ownership in real estate under the fictional assumption that a husband and wife are considered one person for legal purposes. This method of ownership conveys the property to them as one person.

What is the difference between a joint tenancy and a tenancy in common? ›

Further tenancy in common allows parties to hold unequal shares of property interest. Joint tenancy requires each co-owner to hold equal shares of property. Further, co-owners must transfer the deed at the same time. In this sense, joint tenancy is rigid compared to tenancy in common.

Which is a key difference between tenancy in common and joint tenancy quizlet? ›

*Unity of ownership-- Whereas tenants in common hold separate title to their individual interests, joint tenants together hold a single title to the property.

What are the tax implications of tenancy in common? ›

The property remains a single unit in the eyes of the law; tenancy in common is merely an agreement among the owners about how they own that single property. Typically, real estate taxes will be assessed on the property, and all owners listed on the deed are legally responsible for the full amount of the tax.

Which must always be true of tenants in common? ›

Which must always be true of tenants in common? Each tenant must have an equal ownership share, Each tenant rents his share of the land from the other co owners, Each tenant has the right ow survivorship, Each tenant owns an undivided iterest in the property.

Who owns the property in a time share estate? ›

Who owns the property in a time-share estate? The property is owned by tenants in common or by a freehold owner who leases on a time-share basis.


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