In the state of California, there is a new option available to transfer real property upon death. The revocable transfer on death (TOD) deed or beneficiary deed is an alternative method of transferring property without it going through probate, and without having to create a living trust.
Why TOD is a Good Alternative
One way to avoid probate that property owners often consider is to add their loved ones to the title of the property as joint tenants. This is a method that allows the property to avoid probate and be passed directly to those who are listed on the title. There is, however, several drawbacks to this option. First, adding someone to the title of the property could be considered a gift, and a gift tax may be due. Second, the creditors of those whose names are added to the title could collect against the property, including attaching a lien. Finally, naming a person as a joint tenant gives that person an immediate ownership right to the property, including the right to live in your property rent-free or force the sale of the property.
How Revocable Transfer on Death Deed (TOD) Works
The TOD allows a person to designate the beneficiary of the property, which only becomes effective upon the person’s death, so the beneficiary gains ownership rights to the property only upon the person’s death. To establish a TOD, one needs to fill out the proper form with the name of the beneficiaries clearly stated on it. This form needs to be notarized and recorded with the County Recorder’s Office. Furthermore, the name and description of the property must be accurate in accordance with the deed of the property. In addition, the names of the beneficiaries must be stated. You can download a TOD Deed by clicking here.
You can revoke a TOD at any point before your death by recording a Revocation of TOD or recording a new TOD with the names of the new beneficiaries. A revocation form can be found in the same location as the TOD Deed itself. Even though you can find these forms online, it is still important to discuss the matter with a knowledgeable and experienced estate planning attorney to ensure that everything is done correctly and that your true wishes are being enacted. After someone has passed, you should consult with a probate attorney to determine whether the decedent executed a TOD deed, a Will or a Trust. The Los Angeles probate attorneys at Keystone Law Group, P.C. can help you determine whether you are entitled to inherit real property or other assets of a decedent, and can assist you with transferring those assets even if the decedent did not sign a TOD deed, Will or Trust.
It is important to note that you do not need be the sole owner of the property in order to transfer the property to your intended beneficiaries through a TOD upon death. In the instance that you are the co-owner of the property as a tenant-in-common, you can transfer your ownership interest in the property upon your death without affecting the other co-owners.
If you would like to learn more about transferring assets of a decedent to the beneficiaries or heirs, please contact the probate attorneys at Keystone Law Group, P.C. for further assistance at 310.444.9060 or visit www.Keystone-Law.com for further information.
