As of July 19, 2024, New York State property owners can transfer their real estate property to their designated beneficiaries automatically upon their death through a transfer-on-death deed. This policy change was meant to streamline property entitlements, all while avoiding the legal fees and delays commonly associated with the probate process. For more information, please follow along to find out whether you should include a transfer-on-death deed in your estate plan and how one of the Putnam County asset preservation attorneys at the Law Office of Andres D. Gil, PLLC, can help you create one if it is in your best interest.

What Is a Transfer-On-Death Deed, And How Do I Create One?

To reiterate, and as the name suggests, a transfer-on-death deed does not change your ownership rights over your real estate property to your named beneficiary until the date of your unfortunate passing. Meaning, you may maintain control over deciding whether you want to continue using your property, or even sell or mortgage it, for the rest of your life. This is all while being allowed to revoke this legal document at any time, should you ever change your mind about beneficiary designations or otherwise. Again, this is all done outside of the New York State Surrogate’s Court.

If this seems appealing to you, you may want to take steps toward incorporating one into your estate plan. First, you must be at least 18 years old and deemed of sound mind and memory. You must then sign this legal document before two witnesses, who must then sign the document themselves. This must all be acknowledged by a notary public, as well.

Key Features of a Transfer-on-Death Deed

  • Property transfers automatically upon death, without the need for probate
  • You retain full ownership of the asset over your lifetime
  • You are able to:
    • Sell the assets
    • Mortgage your property
    • Revoke or change the beneficiaries at any point
  • The deed only becomes effective after death
  • The deed must be:
    • Signed with witnesses present
    • Notarized
    • Recorded appropriately in the county clerk’s office

However, these benefits are most effective for individuals with straightforward estate plans and clearly defined beneficiaries.

What Are the Benefits of Using a Transfer-on-Death Deed?

A transfer-on-death deed offers several benefits and advantages for New York property owners, making it an ideal tool to utilize. This is especially true for those who wish to retain control of an asset during the course of their lifetime while still avoiding probate after death.

Benefits of a TOD Dead

  • Completely avoids the probate process
  • Reduces legal fees and administrative issues
  • Allows the direct transfer of property to beneficiaries
  • Maintains flexibility, as you can change or revoke at any time during your life
  • Often simpler than establishing a trust fund
  • Allows beneficiaries to receive property quickly following the death of the estate owner

How Do I Know if I Should Opt for a Transfer-on-Death Deed?

While you may like the offered benefits of a transfer-on-death deed in Putnam County and the surrounding New York communities, you must recognize its potential drawbacks before creating one. For one, you may face the possibility of conflicts if you jointly own this real estate property with your spouse, partner, or another party. That is, if you have a change of heart with this legal document, you need to get the joint owner’s approval before revoking it. And if you sadly pass away before the joint owner, they may make modifications or revocations that ultimately go against your wishes.

Secondly, there may be challenges if you want multiple beneficiaries to inherit your real estate property. This is because your named beneficiaries may only inherit equal shares, and you cannot instruct weighted distributions. So, if one of your beneficiaries sadly passes away, the property may be immediately redistributed among your other named beneficiaries. This is instead of having the deceased’s own beneficiaries benefit from this asset.

This is not even to mention the potentially negative implications that maintaining ownership over your real estate property has on your Medicaid eligibility.

Transfer-on-Dead Deed vs. Other Estate Planning Tools

A transfer-on-death deed is just one of several estate planning options you may wish to consider. As such, understanding how it functions in comparison to other options, like a trust fund, can help you make the best decision for your unique circumstances.

Key Differences Between Other Options and TOD Deed

  • TOD Deed:
    • Avoids probate
    • Limited control over structured distribution of assets
    • Allows for flexibility
  • Last Will and Testament
    • Requires probate
    • Allows for detailed instructions and contingencies
  • Revocable Living Trust
    • Avoids probate
    • Allows for complex distribution planning
    • Higher set-up cost, but allows for more flexibility

Contact a Putnam County Estate Planning Attorney Today

No matter what, you do not need to feel alone in this process. One of the talented Putnam County asset preservation attorneys is ready to be in your corner and support you throughout. So please reach out to the Law Office of Andres D. Gil, PLLC whenever you are ready. Our team is ready to help you navigate your legal options so you can make the best decisions for the future. Contact us today to learn more.