Transfer-On-Death Deed May Very Well Be The Best Thing Since Sliced Bread

Nowadays, a person might be able to avoid Probate, and the expenses of a Trust, using an inexpensive Transfer-on-Death Deed (TOD deed) with real estate. The TOD deed has been available in Wisconsin since 2005. In the time since, it has proven to be a simple, inexpensive and effective tool to transfer a real property interest at the death of the owner, and has become very popular with attorneys, property owners and beneficiaries alike.

If the landowner properly completes and files a TOD deed with the register of deeds, when the landowner dies, title to the real estate passes directly to the beneficiary or beneficiaries named in the TOD Deed. This is similar to how title passes in a Joint Tenancy Deed. No Probate is needed.

A landowner can change her mind with a TOD deed designation too. If circumstances change after a landowner designates someone to receive the real estate using a TOD deed, the landowner can revoke her TOD deed or simply replace it with another one naming someone else. The TOD deed can also reduce some risks from third parties. This is because even though individuals are named as beneficiaries under a TOD deed, they have no ownership rights until after the death of the landowner. This lack of ownership rights in the real estate helps avoid problems. For example, if a landowner adds her son, her grandson, or her daughter as beneficiary under a TOD deed, the real estate cannot end up as a divisible asset in her son’s divorce, liquidated asset in her grandson’s bankruptcy, or with liens on it from her daughter’s creditors.

For some people the TOD deed may be the most effective way to pass real estate to desired beneficiaries. However, careful consideration should always be given to determine if the TOD deed is appropriate for your particular circumstances. There are many ways to transfer real property and many facts to consider. You should always ask your attorney for assistance in determining if the TOD deed is right for you.

Submitted by Attorney Walter E. Shannon