Also known as: ownership interest · investment interest · ownership interests · investment interests · beneficial ownership · equity interest
Written by attorneys · grounded in primary & secondary sources — see below
An interest in property or an entity that confers rights of ownership or investment, including equity, debt, or other holdings that allow the holder to benefit from or control the asset.
Olivia Owens transfers her vacation cottage to her niece without receiving payment. She does so with the clear intent that the niece receive full title immediately. The transfer completes a gift because an ownership interest passes to the donee.
Orla O'Malley and her husband held a joint bank account with right of survivorship. When the husband dies, Orla's ownership interest in the account is included in calculating her augmented estate. The interest passes directly to her by operation of the registration.
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Odyssey Logistics registers shares in the name of a nominee. The board adopts a procedure allowing the beneficial owner to file a certificate and be treated as the record shareholder. Filing the certificate gives the owner the rights and privileges of record ownership.
Orlando Okafor grants a mortgage on Blackacre to secure a loan. The mortgage creates an encumbrance but does not transfer ownership interest to the lender. The borrower retains full ownership subject to the lien.
Owen Ortega holds a power of appointment over a trust remainder. He exercises the power to name recipients of the beneficial ownership interests in the appointive property. The exercise transfers those interests according to the power's terms.
Odette Orozco, the surviving spouse, had previously transferred property by beneficiary designation. That property is included in her augmented estate under the nonprobate transfer rule, separate from her direct ownership interests already counted. The inclusion adjusts the elective share calculation.
An ownership interest confers full rights in the property itself. An encumbrance, by contrast, is a lien or mortgage that gives the holder a right short of ownership. The distinction determines whether a transaction transfers title or merely secures an obligation.
The interest is included when the property is held in co-ownership registration with right of survivorship. Valuation occurs immediately before the decedent's death. This inclusion prevents the surviving spouse from shielding assets from the elective share calculation.
The corporation must have adopted a procedure allowing filing of a beneficial ownership certificate. The certificate must meet the specified form and signature requirements. Once filed, the beneficial owner is treated as the record shareholder for the rights the procedure grants.