Can I Use a Transfer on Death Deed as an Estate Planning Tool for Real Estate in New Jersey?
For many people, real estate—whether a primary residence or other property—is among their most important assets. With that in mind, it is crucial that real estate is at the center of your estate planning strategy. You may be wondering: Can I use a transfer on death deed for real estate in New Jersey? The short answer is “no”—in contrast to several other U.S. states, New Jersey does not allow transfer of death deeds for real estate. Here, our Monmouth County estate planning lawyer explains the key points to understand about transfer on death deeds in New Jersey.
What is a Transfer on Death Deed?
A transfer on death deed (TODD) is a legal document that allows property owners to designate a beneficiary who will inherit their property upon their death without the property having to go through probate. It is a deed that is recorded with the local county registrar and it becomes effective only upon the death of the property owner. It is a powerful estate planning tool—but it is only recognized as a valid option in certain jurisdictions.
New Jersey Does Not Allow Transfer On Death Deeds for Real Estate
Unfortunately, New Jersey does not permit the use of TODDs for real estate. In effect, this means that property owners cannot bypass the probate process simply by preparing such a deed. Other estate planning tools must be used instead.
Note: Although you cannot use a transfer on death deed for real estate in New Jersey, you can use one for a motor vehicle. The New Jersey Motor Vehicle Commission (MVC) offers a form that you can use to set up the efficient transfer of the ownership of a motor vehicle upon death.
An Overview of Your Estate Planning Options for Real Estate in New Jersey
While you cannot use a TODD for your primary residence or other real estate in New Jersey, there are other estate planning options available. Here is an overview of the most common:
- Joint Ownership (Right of Survivorship): Joint ownership with right of survivorship allows property to pass automatically to the surviving owner(s) when one owner dies. There is no probate. It is the best tool for spouses and, in some cases, other family members.
- Will: You can pass real estate to your heir through your will. With that being said, a will that includes real property generally needs to go through formal probate in New Jersey.
- Trust: If you want to avoid probate without using joint ownership, the best option for real estate planning in New Jersey is setting up a trust. A valid trust allows for probate to be avoided. It may also offer other benefits.
Consult With Our New Jersey Estate Planning Lawyer Today
At Poulos LoPiccolo PC, our New Jersey estate planning attorney is an experienced and solutions-focused advocate for people and families. If you have any questions about how to set up an estate plan for the transfer of real estate, please do not hesitate to contact us today. With an office in Monmouth County, we provide estate planning support all across New Jersey.
Source:
nj.gov/mvc/pdf/vehicles/beneficiary_transfer_form.pdf
