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How a Transfer on Death Deed Works in Illinois


A transfer on death deed (TODD) is a legal instrument that allows property owners to bypass probate and distribute real estate directly to a beneficiary upon their passing. Whether you’re an elderly homeowner, a single individual or someone with a modest estate, a TODD might be a suitable tool for your estate planning needs. Here’s what you need to know about setting up a TODD in Illinois. For help protecting your assets, talk to a financial advisor.

What Is a Transfer on Death Deed?

A transfer on death deed (TODD) is an estate planning instrument designed to facilitate the transfer of real estate upon the death of the property owner. So when you pass, the property automatically transfers to the designated beneficiary without the need for probate proceedings.

Unlike a will, which must undergo probate, or a trust that require the ongoing oversight of a trustee, TODDs offer a simple estate planning solution. However, the legal framework can vary by state.

The Illinois Residential Real Property Transfer on Death Instrument Act governs the use of TODDs in the state. These deeds become operative upon the property owner’s demise, provided they meet requirements for execution, witnessing and recording.

To set up a TODD, you typically need to complete a TODD form, specifying the beneficiaries who will receive the property upon your death. And then file the form with the appropriate government office, such as the county recorder’s office, to ensure that the deed complies with the legal requirements of your jurisdiction.

Benefits of Filing a Transfer on Death Deed

A TODD can significantly reduce delays and expenses associated with probate — a process that can take months, if not years, and a sizeable portion of your estate’s value. Probate costs can range from 3% to 7% of an estate’s value.

Using a TODD also enables you to continue to make all decisions on your property until your death as it doesn’t lock it up in any way or give anyone else any rights until you pass away.

When You Might Use a Transfer on Death Deed

In Illinois, a transfer on death deed can help protect your home from probate.

This tool is particularly strategic for individuals seeking a direct and uncomplicated method to transfer real estate to a beneficiary or a small group of heirs. A TODD is optimal in scenarios such as:

  • A single individual wishing to leave property to a close relative or friend.
  • Elderly homeowners who want a smooth transition of their home to a designated heir.
  • Individuals with modest estates seeking to bypass probate.

However, it’s crucial to understand that TODDs are not a one-size-fits-all solution, but they must be considered as part of a broader estate planning strategy. They are ideal for certain circumstances but may not fit every estate planning objective.

Requirements for a Transfer on Death Deed to Be Valid in Illinois

In Illinois, a transfer on death deed must meet specific criteria to be considered valid. The following breakdown provides clarity on the process:

  • The individual must be at least 18 years old and mentally capable of understanding the deed’s implications.
  • Applicable to residential real estate, including single-family homes, condominiums and buildings with up to four units.
  • The deed must include the legal description of the property, the owner’s signature and be witnessed by two non-beneficiary credible witnesses, plus notarization.
  • The deed must be filed with the county recorder’s office where the property is located before the owner’s death.

Understanding and fulfilling these requirements is critical to guaranteeing that your transfer on death deed is legally sound and enforceable, allowing for the intended transfer of your property to be carried out as you wish.

Bottom Line

A transfer on death deed can offer a straightforward estate planning solution that can help you avoid probate.

A transfer on death deed (TODD) can offer a straightforward and probate-avoiding solution for transferring property to a designated beneficiary in Illinois. While it can help you avoid probate and provide control and flexibility to the property owner, it’s not a guarantee for all estate planning needs. The TODD must be approached with a comprehensive understanding of its legalities, including capacity, documentation and recording requirements, to ensure it aligns with the owner’s intentions.

Tips for Financial Planning

  • There are a lot of factors to consider when completing a financial plan. A financial advisor can offer you specific advice for your financial situation. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
  • Protecting property is just the first step to consider in your estate planning. Consider this estate planning checklist to help you get started.

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