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Property transfer after owner's death

Transfer-on-death deeds can provide probate-avoiding advantages

by Jonathan Doughtery | Contributor
January 11, 2023

The pros and cons of transfer-on-death deeds in estate planning

Estate planning is about leaving your assets to your loved ones when you pass away. And one of the goals is to do this efficiently, uncomplicatedly, and with the minimum tax burden possible. As of November 2022, 31 states allow you to use a transfer-on-death deed (ToD deed) to directly transfer real estate to a beneficiary and avoid the time delays, expenses, hassles and lack of privacy of the probate process.

The basic idea is simple. You correctly fill out a ToD deed naming the beneficiary and file it with the county recorder's office. Upon your death, the property is transferred to your named beneficiary without the need or expense of a will or trust. And no probate is necessary.

The process is so straightforward that you wonder why everyone doesn't use this estate planning tool. While a ToD deed makes sense in some situations, there are several disadvantages to be aware of before you use it.

What is a transfer-on-death deed?

A ToD deed is a legal document allowing you to transfer your property ownership to a designated beneficiary upon your death.

It's similar to leaving the property through a will in that it specifies who the property goes to after you pass away. But there are a few key differences.

A TOD can help you transfer real estate upon your death

One significant difference between a ToD deed and a will is that a ToD deed becomes effective immediately upon your death. In contrast, a will goes through the probate process before its distributions can be carried out. Probate is the often lengthy and expensive legal process by which a court determines the validity of the will and oversees the distribution of a deceased person's assets.

Transferring ownership of your property through a ToD deed can help avoid probate and make it easier, faster and less expensive for your beneficiaries to receive the inherited real estate.

Another difference between a ToD deed and a will is that a ToD deed only applies to real estate, while a will can be used to distribute any type of property, including personal possessions and financial assets. Suppose you want to transfer ownership of other types of property. In that case, you'll need to use a different method, such as a trust or a beneficiary designation on a financial account.

Types of transfer-on-death deeds

Each of the 31 states that allow ToD deeds have different state laws affecting the transfer. You should be familiar with the laws in the appropriate state. And remember, it is not necessarily the law in your state. The applicable law for ToD deeds is the state where the property is located.

And different states may use different terminology for the ToD deeds, and you may see them referred to as:

  • Transfer-on-death instrument
  • Beneficiary deed
  • Deed upon death

Whatever term your state uses, the primary purpose of a ToD deed is to avoid probate and allow you to transfer the deed of your property to a named-beneficiary after you pass away.

Which states allow ToD deeds?

Of the 31 states allowing transfer-on-death deeds, Missouri was first by allowing them in 1989. Since then, other states have recognized and accepted ToD deeds, and they are as follows: Alaska, Arizona, Arkansas, California, Colorado, Hawaii, Illinois, Indiana, Kansas, Maine, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Mexico, North Dakota, Ohio, Oklahoma, Oregon, South Dakota, Texas, Utah, Virginia, Washington, West Virginia, Wisconsin, Wyoming and the District of Columbia.

Because the transfer-on-death deed laws were so fragmented in many states, the Uniform Law Commission designed a model Uniform Real Property Transfer on Death Act (URPTODA). As other states decide to allow transfer-on-death deeds, many lawyers and other real estate professionals hope this model is adopted to bring uniformity to the 50 states.

Advantages of ToD deeds

Probate avoidance

The main advantage of transfer-on-death deeds is the transfer of real property outside of probate. With a properly executed transfer-on-death deed, the real property is transferred to the beneficiary immediately upon the owner's death by operation of law. The beneficiary does not go to court because the real property never becomes part of the estate. The expense, delays, stress and lack of privacy of probate are avoided.


Another advantage is that the grantor fully and freely owns the property during their lifetime. Assume the grantor prepared a ToD deed to transfer a house to his child upon the grantor's death. The grantor can change their mind at any time. They can cancel the deed or execute a new one. They can rent the house, sell it or even take out a mortgage.

If the grantor had created a life estate for the house with a remainder interest, then the beneficiary would have an interest in the property during the grantor's lifetime. And the beneficiary would need to consent to financial decisions like placing a lien on the property, taking out a mortgage or selling the property. If the house were sold, the life estate remainder beneficiary would likely have a right to a portion of the sales proceeds. This is not the case with a ToD deed.

No beneficiary consent needed

In a life estate remainder option, the beneficiary must agree to their role as the beneficiary and be willing to accept the property. This is not needed with a ToD deed. The grantor does not need the beneficiary's permission and can change beneficiaries at any time.

The beneficiary of a transfer-on-death deed has no legal interest in the property, and their permission is not needed for any financial transaction involving the property.


Many adults need long-term care, and it is usually expensive. Some families are fortunate enough to have the financial resources to cover private care. Some seniors had enough foresight to have long-term care insurance. But others need Medicaid's help to pay for part of their long-term or acute care.

However, when Medicaid covers these costs, it is often in the ToD deed form of an interest-free loan. When the senior dies, Medicaid often seeks reimbursement from the senior's probate estate. Since a property transferred by a ToD deed does not become part of the estate, Medicaid is usually precluded from receiving an interest in the house.

Disadvantages of ToD deeds

Your private information becomes public

Many people use wills and trusts as part of their estate plans to transfer property. A will is private when executed but can become public during probate. On the other hand, trusts are designed to be private and remain confidential. They are not filed with the county or the courts. Even when a trust obtains bank accounts, you give the bank a certificate of trust, a one or two-page document identifying the trust. The bank does not get a copy of the trust and its confidential terms.

But a ToD deed is public information as soon as it is filed at the county recorder's office. And to be effective, it must be filed during the grantor's lifetime. That means anyone with prying eyes can search the court records and find your name, the beneficiary’s name, the property being transferred and other normally confidential material. A ToD deed may not be for you if you highly value your privacy.

And sometimes the prying eyes are in the family. With a ToD deed, you can change your mind and change beneficiaries. But you must revoke the first ToD deed with a public recording. Do you really want one family member to know they were going to get the house, but you changed your mind and decided to give it to someone else? The public record is public, even to your family. Trusts are far more private.

Using a TOD deed to transfer one property to a single individual seems straightforward. But what if you list your three adult children as beneficiaries, and one dies before you do? Do the grandchildren of your deceased child get their share of the property?

For example, let's say you have three children, Andy, Betty and Charlie. You prepare and file a ToD deed listing all three beneficiaries. Further, let's assume they all have children, namely, your beloved grandchildren.

Suppose Andy dies before your do. Will the ToD deed transfer Andy's share to his children? That is what would customarily happen with a trust or will.

But with a ToD deed transfer, the answer is no.

When you die, the ToD deed will not direct a share of the property to Andy’s children. Betty and Charlie inherit the entire property equally, and Andy's family gets nothing.

Will and trusts easily handle this issue and ensure that Andy's family gets his share. ToD deeds cannot.

ToD deeds can mean uncertainty in estate planning

The body of law that interprets trusts and wills is centuries old, and most legal questions are well-settled. Trusts and wills go back to the days of the Roman empire and were used for centuries in England. Trusts and will have been used in our country since its inception.

However, ToD deeds are new by legal standards. The first was used in 1989, and not all states have adopted them. Washington State just started allowing them in 2014. If conflicts arise, the outcomes are more uncertain with unsettled laws.

For example, state laws vary and are complex and complicated when using a ToD deed to transfer property to a married person in a community property state. And what happens when you update and re-write your will but forgot about an older ToD deed you filed? Does the updated will take precedence over the ToD deed? Probably not.

All the money you thought you were saving with a simple ToD deed transfer might be gone if you have to litigate unresolved state law issues.

An example: Wisconsin versus Pennsylvania

So how do states compare with property transfers upon the owner's death when one state allows ToD deeds and the other does not? Take the case of Wisconsin, which allows ToD deeds, versus Pennsylvania, which does not.

In Wisconsin, an individual can transfer ownership of real property to a designated beneficiary upon death through a ToD deed. This allows for a non-probate transfer, meaning that the property is transferred outside the probate process. This can be a simpler and less expensive option than going through probate, as it can avoid court approval and certain costs and taxes.

In contrast, no specific law authorizes the use of ToD deeds in Pennsylvania. As an alternative, individuals in Pennsylvania can use a life estate deed or a trust funding deed to transfer ownership of real property at death.

A life estate deed is a legal instrument that allows an individual to transfer ownership of real property to a designated beneficiary but retains the right to use the property for their lifetime. This can be a simpler and less expensive option than probate, but it may provide a different level of control over the property than a TOD deed.

A trust funding deed is another alternative in which the property is transferred into a trust during your lifetime. Then the trust owns it after your death. This can provide more control and flexibility over how the property is managed and distributed. Still, it can also be more complex and costly and require more planning before death.

Overall, while ToD deeds are not available in Pennsylvania, alternative options such as life estate deeds and trust funding deeds may provide similar benefits, but they have their own limitations and disadvantages and could be more complex and expensive than a ToD deed.

Is ToD deed property inherited?

Property transferred via a ToD deed is considered to be inherited property because it passes to the beneficiary as a result of the death of the owner.

The key feature of a ToD deed is that it only takes effect when the grantor dies. Until then, the grantor retains full control over the property and can sell it, mortgage it or otherwise dispose of it as they see fit.

How do I obtain a ToD deed?

To get a blank ToD deed, you can get one online, from an attorney or from a real estate professional. Or you can go to the source and obtain one from your county office that records land transactions, sometimes called the county recorder, registrar of deeds or land registry.

The ToD deed is a short form that seems easy to fill out.

But since it is an essential legal document that transfers real property to your beneficiary in the future, it is a good idea to have an attorney help you fill this out. If you do it yourself, you will never know if it is correct because it only takes effect after you die. If you make a mistake, your loved ones will deal with the error after you are gone.

Although each state varies, the basic steps are:

  • Get a state-specific ToD deed. Get the form recognized by your state.
  • Decide on your beneficiary. Although you can name more than one, things are more straightforward with a single beneficiary. Be specific. Unlike a will, you do not want to say terms like "my children" Use full legal names for your beneficiary or beneficiaries.
  • Include a legal description of the property. Many people copy the exact language from the current deed.
  • Sign, notarize and have two witnesses. Every state is different, and this step is crucial to get right. Many states require you to sign the deed before a notary and two witnesses who are not related to you and not the beneficiary. Check with your state laws.
  • Record the deed. A ToD deed is valid once properly recorded and filed with the county.

Should a ToD deed be part of your estate plan?

A transfer-on-death deed is a straightforward document to simplify a real estate transfer to your beneficiary and avoid probate. It has advantages and disadvantages compared to wills, living trusts and other estate-planning tools.

For peace of mind and your family's financial well-being, your next best step is to decide your best estate planning strategies. By acting now, you ensure your assets will be distributed to your children and stepchildren according to your wishes.

How do I create an estate plan?

There are numerous options and scenarios to consider when developing an estate plan that protects your legacy and achieves your objectives, and important decisions should be made with the advice of qualified lawyers and financial experts. Membership with Legacy Assurance Plan provides members with valuable resources and guidance to develop comprehensive estate plans that take life's contingencies into consideration and leave a positive impact for generations to come. Legacy Assurance Plan members also receive peace of mind that a team of trusted, experienced professionals will assist them in developing legal, financial and tax strategies that will meet their needs today and for years to come through periodic reviews.

This article is published by Legacy Assurance Plan and is intended for general informational purposes only. Some information may not apply to your situation. It does not, nor is it intended, to constitute legal advice. You should consult with an attorney regarding any specific questions about probate, living probate or other estate planning matters. Legacy Assurance Plan is an estate planning services company and is not a lawyer or law firm and is not engaged in the practice of law. For more information about this and other estate planning matters visit our website at

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