What is a Transfer on Death Deed and what is it used for?
Also known as the Beneficiary Deed, the TODD is a document that states who will receive real estate upon the death of its current owners. Real estate that isn’t held in a certain way or owned by someone is considered probate property and must inevitably pass through the probate process—an expensive and long legal process through which the property of a deceased person is managed and dispersed under court supervision.
To avoid this, the property must be turned into non-probate property. One simple way to do this is to use a Transfer on Death Deed. The TODD allows for the owner(s) of a property to pass it along to a beneficiary after the last surviving owner dies. In this deed, you can also name an alternate beneficiary to inherit the real estate if your first choice doesn’t survive you. If you choose not to name an alternate, then state law will mandate who inherits your property. This deed has no effect on your ownership while you’re alive; you keep complete ownership of and control your property. You are still obligated to pay the taxes on it, and you are still free to sell it, give it away, or mortgage it.
Who is this beneficial to?
If you own property and would like to pass it onto someone after your death, then the TODD is the right choice for you. It is easy to create, can be revoked, and makes the probate process entirely avoidable for your beneficiary so the title can be transferred quickly and efficiently without extra costs. In Texas, a beneficiary may be a person, organization, institution, charity, trust, etc. The beneficiary does not need to sign or agree to a TODD, nor must they be informed of its existence until after your death.
Please note: A TODD is one of the forms of documentation accepted by FEMA and other disaster recovery resources when determining eligibility for benefits.
How to file a TODD
A TODD is much like a regular deed, with the major difference being that it doesn’t take effect until after your death. Creating a TODD deed is rather quick and easy. Simply complete the following steps:
- Fill in information about you and your TODD beneficiary;
- Enter a legal description of the property you wish to transfer;
- Sign the deed and have it notarized; and
- Record the deed at the land records office in the county where the property is located.
Lone Star Legal Aid is a 501(c)(3) nonprofit law firm focused on advocacy on behalf of low-income and underserved populations. Lone Star Legal Aid serves the millions of people at 125% of federal poverty guidelines that reside in 72 counties in the eastern and Gulf Coast regions of Texas, and 4 counties of southwest Arkansas. Lone Star Legal Aid focuses its resources on maintaining, enhancing, and protecting income and economic stability; preserving housing; improving outcomes for children; establishing and sustaining family safety and stability, health and well‐being; and assisting populations with special vulnerabilities, like those who have disabilities, or who are elderly, homeless, or have limited English language skills. To learn more about Lone Star Legal Aid, visit our website at www.lonestarlegal.org.
Media contact: Clarissa Ayala, email@example.com.