A transfer on death (TOD) deed, also called a beneficiary deed, names who inherits your real estate when you die, without the property ever passing through probate. During your life it changes nothing: you keep full ownership, can sell or mortgage freely, and can revoke the deed at any time.
It is authorized by statute in about 30 states plus the District of Columbia, and it has one absolute requirement that trips people up: the deed must be recorded before death, or it is void.
How a TOD deed works, before and after death
- During life: the owner keeps complete control; the beneficiary has no rights, no lien, and no say
- Revocation: record a revocation or a new TOD deed at any time; the latest recorded instrument controls
- At death: title vests in the beneficiary automatically, typically after recording a death certificate and a state-specific affidavit
- Debts follow the property: the beneficiary takes subject to the mortgage and liens, and in many states subject to creditor claims against the estate for a limited period
TOD deed vs joint tenancy vs living trust
| Tool | Probate avoided? | Main drawback |
|---|---|---|
| TOD deed | Yes | Not available in every state; single-asset tool |
| Adding a joint tenant | Yes | Irrevocable gift now; exposes property to co-owner's creditors |
| Revocable living trust | Yes | More setup cost; must retitle assets into the trust |
The TOD deed's advantage over adding a child to title is enormous and underappreciated: it is revocable, it makes no gift during life, it keeps the property away from the beneficiary's creditors and divorces while you live, and the beneficiary receives a stepped-up basis at death. A living trust remains the better tool when there are multiple properties, minor beneficiaries, or incapacity planning needs.
State availability and formalities
Most western and midwestern states authorize TOD deeds (many via the Uniform Real Property Transfer on Death Act); Texas, California, Ohio (transfer on death designation affidavit), Arizona, and Colorado all have versions with their own quirks. Several states, including Florida, New York, and Georgia, do not authorize them at all (Florida has the distinct enhanced life estate or Lady Bird deed instead). California requires two witnesses and imposes a statutory form. Because the formalities are state-specific and unforgiving, verify your state's current statute before signing and recording.
Record it or it never existed
Unlike a will, a TOD deed found in a drawer after death is worthless. Recording with the county before the owner's death is a condition of validity in every authorizing state.
Frequently asked questions
Can I sell or mortgage the property after recording a TOD deed?
Yes, freely and without the beneficiary's consent. The beneficiary has no interest while you live. Selling the property simply makes the TOD deed inoperative as to what you sold.
How do I revoke or change the beneficiary?
Record a revocation instrument or a new TOD deed naming someone else; the most recently recorded document controls. A will cannot override a recorded TOD deed, which surprises many people.
Does the beneficiary take the property free of the mortgage?
No. The beneficiary inherits the property subject to all liens and mortgages existing at death, and in many states remains exposed to estate creditor claims for a statutory period after death.
What if I name my spouse and we later divorce?
In many states, divorce automatically revokes a TOD designation in favor of a former spouse, but not everywhere. The safe practice after any divorce is to record a new deed or an express revocation.
Is a TOD deed valid in every state?
No. Roughly 30 states and DC authorize them; Florida, New York, and Georgia are notable states that do not. The deed must comply with the law of the state where the property is located, regardless of where the owner lives.