What is a transfer on death deed?

In Texas, a Transfer on Death Deed (TODD) is a legal instrument that allows you to transfer real estate to a designated beneficiary upon your death without the need for probate. It is also known as a “Lady Bird Deed” or a “Beneficiary Deed.” This type of deed is authorized by the Texas Estates Code, Chapter 114, Subchapter H.

Here are some key features of a Transfer on Death Deed in Texas:

1. Avoiding Probate: The primary purpose of a TODD is to transfer real property directly to a designated beneficiary upon the owner’s death, bypassing the probate process. This can help streamline the transfer of the property and potentially save time and money for the beneficiary.

2. Retained Control: While you are alive, you retain full control and ownership rights over the property. You can sell, mortgage, or transfer the property to someone else, revoke the TODD, or change the designated beneficiary without their consent.

3. Revocable: The TODD is revocable during your lifetime, meaning you can change or revoke it at any time as long as you have the legal capacity to do so. You can execute a new TODD or use a different estate planning method if your circumstances change.

4. Beneficiary Designation: You can name one or more beneficiaries who will receive the property upon your death. The beneficiary designation can include individuals, organizations, or even trusts.

5. Required Execution and Recording: To be valid, a TODD must be executed and signed in the presence of a notary public and two disinterested witnesses. It must be recorded in the deed records of the county where the property is located before your death.

It’s important to note that while a TODD can be an effective estate planning tool, it may not be suitable for everyone. Its use depends on your specific circumstances and goals. Consulting with a qualified estate planning attorney is advisable to ensure that a Transfer on Death Deed aligns with your overall estate plan and any other estate planning tools you may have in place.