For many people in Indiana, real estate is the most valuable asset they own. If you own real estate, it may be smart to consider adding a transfer-on-death (TOD) deed to your estate plan. This document can allow your real estate to pass directly to your beneficiaries without having to undergo the probate process.
Do you need a TOD deed?
If you co-own real estate with someone, you probably don’t need a transfer-on-death deed in order to avoid probate. Your real estate will simply remain the property of the co-owner without going through probate court.
In situations in which you are the sole owner of real estate, to avoid probate, you can:
• Place the real estate in a living trust.
• Set up a TOD deed.
Setting up a living trust and placing your real estate in it can avoid probate, but it is a lot more complicated and expensive than making a TOD deed. However, if you are already creating a trust for other reasons, placing your real estate in the trust may be a good idea. For people with relatively simple estate planning needs, a TOD deed is the simplest way to pass real estate to a beneficiary.
What does the TOD deed do?
When you sign a TOD deed, which is also referred to as a beneficiary deed, you are putting your property in the name of the beneficiary. However, everything that is written on the deed is only valid after your death. During your lifetime, you remain the sole owner of your property with all the same legal rights as any other property owner. You could even decide to sell your real estate since your beneficiary has no legal right to the deed while you are still alive.