Account Registration Types
Quick Answer
Registration determines who owns an account and how assets pass at death. Individual accounts pass through probate, JTWROS bypasses probate with right of survivorship, Tenants in Common passes the decedent's fractional share through their estate, and Tenants by the Entirety is a married-couple JTWROS variant. Entity accounts require charter plus resolution naming authorized signers.
Once the representative knows which type of account applies, the next step is deciding who owns it. Registration determines who can trade, how assets pass at death, and whether the estate must go through probate. The exam tests registration by asking about death consequences, not ownership mechanics.
What are the individual and joint account registration types?
| Registration | Ownership | What Happens at Death of One Owner |
|---|---|---|
| Individual | Single owner; account is the sole property of that person | Passes through the decedent's estate per will or intestate succession |
| Joint Tenants with Right of Survivorship (JTWROS) | Two or more owners each own 100% of the account (not a 50/50 split) | Surviving owner(s) inherit the entire account outside of probate; no will required to pass assets |
| Tenants in Common (TIC) | Each owner holds a specified fractional interest (often equal but can be unequal); shares are not automatically transferable to co-owners at death | Deceased owner's fractional share passes through their estate per will or intestate succession (probate applies) |
| Tenants by the Entirety (TBE) | A special form of JTWROS available only to married couples in states that recognize it; neither spouse can unilaterally sell or encumber the property | Surviving spouse automatically becomes sole owner (right of survivorship) |
| Community property | Spousal ownership recognized in community-property states (AZ, CA, ID, LA, NM, NV, TX, WA, WI); property acquired during marriage is jointly owned 50/50 regardless of titling | Deceased spouse's 50% share passes under their will or by intestacy; no automatic survivorship |
- For JTWROS, each tenant has an undivided interest: either owner can execute trades, deposit funds, or withdraw funds unless the account agreement restricts otherwise
- For TIC, if the account agreement does not restrict withdrawals, any tenant may request a distribution of their fractional share; death of one tenant does not give the others automatic control over the decedent's share
Memory Aid:
- JTWROS = "Right Of Survivorship" (survivor gets all, avoids probate)
- TIC = "In Common" (your share goes to your estate, requires probate)
- TBE = "By the Entirety" (married only, both must agree to trade)
Exam Tip: Gotchas
- JTWROS and TIC are tested via their death consequence, not ownership mechanics. JTWROS bypasses probate; TIC goes through probate. If a question asks "which registration transfers assets to the surviving owner outside of the will," the answer is JTWROS (or TBE for spouses).
- Community-property states and JTWROS are not the same thing. Community-property rules govern what each spouse owns under state law; JTWROS is a specific titling choice. A married couple in a community-property state can still choose JTWROS or TIC titling. The two concepts are layered, not mutually exclusive.
How are entity and business brokerage accounts registered?
- Sole proprietorship: Business owned by one individual with no separate legal entity; the owner's personal credit and assets are tied to the business; opened using the owner's Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN) and a "doing business as" (DBA) name if applicable
- Partnership: Two or more persons doing business together; requires a partnership agreement and often a partnership resolution authorizing named partners to trade in the account; taxed as a pass-through
- Corporate account: Opened by a corporation; requires a corporate resolution naming authorized individuals and attaching the corporate charter/bylaws
- Unincorporated associations: Clubs, investment clubs, or other unincorporated groups; require documentation naming authorized persons and governing rules
Think of it this way: Entity accounts require two layers of paperwork. One document proves the entity exists (articles of incorporation, partnership agreement, bylaws). A second document (the resolution) names the specific people who are allowed to place orders in the account.
Exam Tip: Gotchas
- Any entity account requires two things: evidence the entity exists (charter, bylaws, partnership agreement) AND a resolution identifying the authorized persons who can trade. A corporate officer who is not named on the resolution cannot place trades even if the officer signs other corporate documents.