In theory, the difference between Joint Account Holder and Authorised User is quite clear. If you and your spouse are listed as joint account holders on the credit card agreement, you both are basically co owners and liable for the debt on the credit card. The spouse who is an authorized user is not responsible for the debt and cannot be forced to pay, and is simply authorized to use the credit card. In practice, however, things can be very different.

Typically, a person wants to become an authorised user on someone credit card to improve his or her credit score. You must read the contract very carefully. Even if you are not a joint account holder, some credit card issuers, notably American Express and USAA may hold you fully responsible for the debt on their credit cards if the account owner defaults. Just being on that account, can make you liable for the debt. And the negative information will be reported on your credit report.

And while you can contact credit reporting agencies and request them to remove you from the defaulted credit card account, the issuer will likely demand that you would repay the debt. And if one spouse is an authorized user on the other’s credit card, he or she will be treated just as a joint account holder in many of the Community Property States.

Derived from Spanish law, the community property system is enforced one way or the other in Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin. It dictates that whatever you earn or acquire during the marriage is co owned by both spouses, regardless of who earned it or whose name is on the title. If you live in one of these states, the whole joint account holder vs. authorized user dilemma may matters very little, since as a spouse, you are liable for the debt you accumulate as a married couple, even after divorce.

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