Estate Planning Update:
A law providing a new Estate Planning tool, the Transfer on
Death (“TOD”) Deed, has been enacted by the Texas Legislature, effective
September 1, 2015. If a person dies
having signed and recorded a TOD deed for real estate owned by the person, it
may be possible to avoid the expense of a proceeding in Probate Court to ask
for an Order admitting the Will to probate in order to transfer ownership of
the property after the person dies. (A
Will does not have any legal effect unless it is admitted to probate.) A TOD deed can be revoked, and the person to
receive the property may be changed before the owner dies.
A TOD deed does not become effective until the owner dies, so the owner keeps the homestead and over-65 exemptions, if applicable. Because it is an incomplete transfer, the IRS should recognize the “stepped up” basis for the property after the original owner dies. This is general information, and the TOD may or may not be appropriate, in the light of your circumstances. This law firm will be happy to confer with you to determine whether or not signing a TOD deed would a beneficial component of your estate plan. |