New Law Permits Transfer on Death Deed in California

For most California homeowners, the best option for an estate plan centers on the creation of a revocable living trust, which – among other benefits – avoids the lengthy and costly court proceeding called probate. With the new year, Californians now have another option: a revocable transfer on death deed.

Orange County Estate Planning Attorney - California Trusts, Wills, Probate

A new state law, which went into effect on January 1, 2016, permits California homeowners to record a transfer on death deed that automatically transfers a residence to a named beneficiary when the homeowner dies. The homeowner can revoke a transfer on death deed by recording a written revocation, by recording another transfer on death deed, or by selling the property with an irrevocable transfer deed.

While a transfer on death deed could be an effective way to avoid probate for an individual whose only significant asset is a home, I would only recommend a transfer on death deed instead of a trust in a few, limited circumstances. For example, a transfer on death deed might be a good choice for a single parent who wants to leave a residence outright to one adult child and does not want any of the other protections a trust provides.

When there are multiple beneficiaries, minor beneficiaries, protections wanted for a spouse or others, needs to protect against SSI or Medi-Cal claims, or desires to have any control over what happens with the home or any other property, I would not recommend a transfer on death deed instead of a trust. For most people, a revocable living trust is still the best option.

Of course, estate planning is more than just a plan for transferring your home and other assets. If you have children, it is essential to have an effective plan in place for their care. A good estate plan also includes plans for incapacity and medical directives. I would love the opportunity to discuss the various estate planning options with you. Please contact me at chris@chriswhytelaw.com or (714) 937-2076 to schedule a free consultation.

#ESTATEPLANNING