Answer: A great way to transfer your real estate without probate.
While Kansas and Missouri statutes both provide for the non-probate transfers of real estate via the venerable beneficiary deed, it appears California is moving that direction, too.
A recent article in The San Francisco Chronicle, titled “Californians have a new way to keep homes out of probate” explains how the beneficiary deed option will be most useful for single people, to include widows and widowers.
Why?
Married folks in the Golden State already have a built-in probate avoidance approach when they hold title to their home or other assets as community property with right of survivorship or joint tenants with right of survivorship.
Consequently, through such title the surviving spouse can inherit the ownership interest of a deceased spouse in the home they share without it going through probate.
As the article notes, formerly the only way single people could avoid probating their home (short of adding someone to the title while living) was to hold title in trust.
For some singles, this was an option that exceeded their budget.
All that has changed beginning in 2016.
How?
Homeowners who want to use the new option will simply sign an instrument called a Simple Revocable Transfer on Death Deed ("Deed").
Accordingly, this Deed identifies the new owner (or owners) following the death of the current owner.
What are the formalities to mind?
The Deed must be notarized and recorded in the county where the real estate is located within 60 days.
Fortunately, the Deed is flexible.
The maker of the Deed can change his or her mind and revoke the deed at any time.
This new law expires January 1, 2021, so its effects can be studied.
Deeds executed between now and then would not be impacted, but would still be in effect and could be revoked at any time.
On the other hand, new Deeds cannot be executed after that date unless the law is extended.
The law requires the California Law Revision Commission to study and make recommendations regarding the new Deed to the Legislature by January 1, 2020.
Deeds, of whatever nature or purpose, are not do it yourself projects.
Contact an experienced estate planning attorney near you for advice on the best approach for your unique objectives.
Remember: “An ounce of prevention is worth a pound of cure.” When making your financial, tax and estate plans, do not go it alone. Be sure to engage competent professional counsel.
Reference: The San Francisco Chronicle (November 9, 2015) “Californians have a new way to keep homes out of probate”
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