Protecting your assets in Florida does not have to be complicated.

Rule No. 1: spouses should own everything as “tenancy by the entireties.”

This type of property ownership is a legal fiction that protects jointly owned assets from creditors of a single spouse. This rule is especially important for bank accounts. If you and your spouse own a bank account, make make it is owned as “tenancy by the entireties.”

Although there is a statute in Florida creating a presumption that bank accounts jointly owned by spouses are held as tenancy by the entireties, see section 655.79, Florida Statutes (“Any deposit or account made in the name of two persons who are husband and wife shall be considered a tenancy by the entirety unless otherwise specified in writing.”), it is possible that when the account was opened a different type of ownership was selected.

You need to double check. The benefit of owning property, such as bank accounts, as “tenancy by the entireties” is that a creditor of one spouse cannot garnish the account. Only a joint creditor (like a bank with a promissory note signed by both spouses) can garnish it.

Recently, in William v. M&R Construction, et al., No. 1D19-4518 (Fla. 1st DCA Oct. 9, 2020), the First DCA held that creditors cannot aggregate judgments against individual spouses to defeat tenancies by the entireties protection. “The creditor seeking to levy must have a joint debt owed by both spouses…. That the other spouse is also individually indebted to a different creditor does not establish a joint debt.” See also In re Davis, 403 B.R. 914, 917 (Bankr. M.D. Fla. 2009) (“Separate judgments cannot be artificially combined to create a joint judgment or a joint creditor.”).

The bottom line: Spouses should own bank accounts as tenancies by the entirety.

If you have questions about asset protection, creditors, or any other consumer law issues, The Simring Law Group can help. Call us at 954.816.2417.