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'chasing cars' found at https://flic.kr/p/pL7VKS by carlo.mp.almadro (https://flickr.com/people/vancarl) used under Creative Commons Attribution-NoDerivs License (http://creativecommons.org/licenses/by-nd/2.0/)
'chasing cars' found at https://flic.kr/p/pL7VKS by carlo.mp.almadro (https://flickr.com/people/vancarl) used under Creative Commons Attribution-NoDerivs License (http://creativecommons.org/licenses/by-nd/2.0/)

A large percentage of married couples own most or all of their assets jointly. This makes sense because it avoids probate when one spouse dies. It also stops creditors of one spouse from reaching those assets owned by both spouses.

The exception to this rule is the ownership of vehicles. The problem with having more than one name on a vehicle is that it creates additional liability. Michigan has an owner liability statute. That means that the owner of a vehicle is responsible for any damage or injury caused in an accident, even if he is not the driver.

Protect Your Liability

For this reason, married people should own their vehicles separately. The vehicle should be titled in the name of the spouse who regularly drives that vehicle. It is also wise to avoid having your name on vehicles owned by other family members and friends, especially if you don’t drive those vehicles. You may be asked to be a co-signer on a loan, but make sure that does not make you a co-owner of that vehicle.

Michigan Offers a Loophole!

Normally, if a husband or wife owns assets individually, those assets would need to be probated upon the death of that spouse. However, Michigan has a special law that allows titles to vehicles to be transferred without probate. The transfer can be made directly to an heir, for any number of vehicles, provided the total value of the vehicles is not more than $60,000. The heir simply presents a death certificate and completes an Affidavit of Heir Ownership.

Questions? Contact us for a free Estate Planning Consultation!