Perspectives of Transfer on Death Deeds (TODDs)

Perspectives of Transfer on Death Deeds (TODDs)

You have considered adding a Transfer on Death Deed (known as “TODD”) into your estate plan. What other consideration must be made to fully understand the purpose and utilization of this transfer vehicle? We will cover the relationships that a TODD will have with your estate plan and the beneficiaries down the road upon the Grantor Owner’s death.

Factors to Consider When Executing TODDs

If the real property being transferred by a TODD is held by joint tenants, then all of the joint tenants should execute the TODD, or in short, the surviving joint tenant should execute the deed. This explains the significance of knowing the proper title holding of your real property, whether it is held in joint tenancy or as tenants in common. Under the Minnesota Statute governing the TODD vehicle (Minnesota Statutes § 507.071), there are informative guidelines regarding the situation of having your designated “attorney-in-fact” execute a TODD on your behalf. If a TODD is executed by a Grantor’s attorney-in-fact as designated within a Power of Attorney, an estate planning tool to plan for incapacity, the TODD must include authorization for the attorney-in-fact to execute deeds and also, if applicable, the authorization to “make gifts” to him/ herself, as directed under a Power of Attorney.

Recording TODDs

Firstly, a TODD transfer of real property is effective only if it is recorded prior to the death of the last surviving Grantor Owner and recorded in the County where the real property is located. In addition, TODDs and Medical Assistance It is important to remember that the Minnesota Statute governing TODDs is not a Medical Assistance avoidance tool. In order to effectuate a TODD, one must file certain documentation in connection with Medical Assistance, including:

• an Affidavit of Identity and Survivorship for Transfer on Death Deed
• a certificate of death
• and a certificate of clearance from the Minnesota Department of Human Services.

These documents are necessary to prove that no claims for Medical Assistance exist, which may be tied to the grantor owner’s interest in the real property. Most importantly, a TODD has absolutely no effect on determining a person’s eligibility for Medical Assistance.

Using TODDs with Trusts

A TODD deed may transfer an interest in real property to the trustee of a living trust. For instance, a revocable trust, a testamentary trust created under a Will, or any other entity legally qualified to hold title to real property under Minnesota law.

Enforcement of TODDs

Any matter raised in connection with enforcement of a TODD deed shall be determined in the probate court division. However, if you are concerned with creditor issues, creditors cannot attach to a Grantee Beneficiary’s interest in the real property until after the Grantor Owner dies.