Jointly Owned Property
If you own property with another person as joint tenants with right of survivorship, that is, not as tenants in common, the property will pass directly to the remaining joint tenant upon your death and will not be a part of your probate estate governed by your will (or the state’s laws of intestacy if you have no will). It is important to note that whether property is part of your probate estate has nothing to do with whether property is part of your taxable estate for estate tax purposes.
Frequently, people (particularly in older age) will title bank accounts or securities in the names of themselves and one or more children or trusted friends as joint tenants with right of survivorship. This is sometimes done as a matter of convenience to give the joint tenant access to accounts to pay bills. It is important to realize that the ownership of property in this fashion often leads to unexpected or unwanted results. Disputes, including litigation, are common between the estate of the original owner and the surviving joint tenant as to whether the survivor's name was added as a matter of convenience or management or whether a gift was intended. The planning built into a well-drawn will may be partially or completely thwarted by an inadvertently created joint tenancy that passes property to a beneficiary by operation of law, rather than under the terms of the will. In some instances, a power of attorney document giving the trusted person the power to act on your behalf as your agent with regard to the account in order to pay bills will achieve your intended goal without disrupting your intended plans regarding to whom the account will ultimately pass.
Many of these problems also are applicable to institutional revocable trusts and "pay on death" forms of ownership of bank, broker, and mutual fund accounts and savings bonds. Effective planning requires knowledge of the consequences of each property interest and technique.
In many instances, consumers prepare wills believing that the will governs who will inherit their assets when in fact, the title (ownership) of various accounts or real property, for example, as joint tenants, or beneficiary designations for IRAs, life insurance and certain other assets control the distribution of most or even all assets. This is why merely addressing your will is rarely sufficient to accomplish your goals.
source http://www.americanbar.org/groups/real_property_trust_estate/resources/estate_planning/an_introduction_to_wills.html
