Arkansas Beneficiary Deed Form

What is an Arkansas TOD (beneficiary) deed form?

An Arkansas beneficiary deed form is a legal document that transfers real estate on the death of an owner. During life, the owner can change his or her mind without notifying or otherwise involving the beneficiaries named in the deed. Upon the owner’s death, the property passes to the beneficiaries outside the Arkansas probate process. Beneficiary deeds—known in other states as transfer-on-death deeds or TOD deeds—are defined and allowed by law and have been recognized in Arkansas since 2005.¹

What is the purpose of an Arkansas beneficiary deed form?

An Arkansas beneficiary deed allows Arkansas property owners to avoid probate at death without giving up control during life. It can be thought of as a substitute for a living trust, which has the same purpose but is more expensive to set up, fund, and operate. An Arkansas beneficiary deed keeps things simple by letting the property owner name beneficiaries like a transfer-on-death or payable-on-death order on a bank account. On the owner’s death, the property passes to the named beneficiaries. An owner who changes his or her mind before death can revoke the deed or change the beneficiaries.

What is the benefit of avoiding probate?

Probate can be a costly, time-consuming legal process that requires an attorney to appear before a judge and puts all of a deceased owner’s financial data in the public record. Many Arkansas property owners prefer to avoid the expense, hassle, and loss of privacy that come with the probate process.

What types of property can be transferred using an Arkansas beneficiary deed?

An Arkansas beneficiary deed applies only to “real property other than a leasehold or lien interest.”² In other words, it can be used only to transfer ownership of real estate. An Arkansas beneficiary deed cannot be used to transfer automobiles or other property types.

What is the effect of an Arkansas beneficiary deed while the owner is alive?

An Arkansas beneficiary deed has little effect while the owner is alive. It does not transfer any property rights to named beneficiaries until the owner’s death.³ Prior to the owner’s death, the beneficiary deed can be revoked by the owner or owners who made it.⁴

Can the owner sell the property after recording a beneficiary deed?

Yes. A beneficiary deed does not affect the owner’s ability to sell the property. Each named beneficiary’s property rights are “subject to” any transfers made before the owner’s death. If a property is subject to a prior deed, a mortgage, or another title issue, that means the issue still holds power over the property and its owner.⁵ If the owner transfers the entire property to someone else before death, the beneficiary named in the deed receives nothing.

Is an Arkansas beneficiary deed revocable?

Yes. An owner who makes an Arkansas beneficiary deed may revoke the deed prior to death.⁶ There are three ways to revoke the deed:

1. Revocation. The owner may revoke, or cancel, the deed by signing a revocation and recording it in the Office of the County Recorder of the county in which the property is located. The recording must be done before the owner dies.⁷
2. Later beneficiary deed. The owner may sign and record another beneficiary deed to replace the previous one. As long as it is recorded before the owner’s death, the last deed the owner signs will trump any older beneficiary deeds.⁸
3. Sale or transfer of the property. As stated above, the property rights that a beneficiary acquires on the death of an owner are subject to any transfers made before the owner’s death.⁹ If the owner transferred the property to someone else before death, there is nothing left for the named beneficiary to inherit.

An owner’s will cannot revoke a beneficiary deed.¹⁰ Once the owner makes a beneficiary deed, the directions in the owner’s will no longer control the property. If the will contains directions that disagree with the beneficiary deed, the beneficiary deed will control who receives the property.

What is the effect of an Arkansas beneficiary deed when the owner dies?

An Arkansas beneficiary deed form transfers Arkansas real estate to the named beneficiary—sometimes called a grantee—on the owner’s death.¹¹ The beneficiary takes the property subject to all conveyances, assignments, contracts, leases, mortgages, deeds of trust, liens, security pledges, oil, gas, or mineral leases, and other encumbrances made by the owner or to which the real property was subject at the time of the owner’s death, whether or not the conveyance or encumbrance was created before or after the execution of the beneficiary deed.¹²

This broad language means the beneficiary named in the deed accepts the property “as is” at the time of the owner’s death. For example, if the owner has sold, mortgaged, or leased the property to someone else, the beneficiary’s property rights are subject to the prior sale, mortgage, or lease. The beneficiary gets whatever property rights the owner has at death, in the same condition that the owner held them prior to death.

Can an Arkansas beneficiary deed leave property to multiple beneficiaries?

Yes. An Arkansas beneficiary deed may name multiple beneficiaries.¹³ Multiple beneficiaries may hold title as joint tenants with right of survivorship, as tenants in common, in tenancy by the entirety, or in any other form of co-ownership allowed by Arkansas law.¹⁴

Can joint owners sign an Arkansas beneficiary deed?

Yes. Multiple owners may sign the same Arkansas beneficiary deed. The beneficiary deed’s effect depends on how the current owners hold title. Specifically, it depends on whether the owners have survivorship rights and the order of death. Joint owners may hold title with right of survivorship, which is the case if they hold the property as joint tenants with right of survivorship or as tenants by the entirety. The deed may also say that the transfer is effective on the death of the last surviving owner. If both of these are true, then the beneficiary deed will transfer property on the death of the last surviving owner.¹⁵

If the owners hold the deed with right of survivorship and all of the current owners do not sign it, then the effect depends on the order in which the owners die. If the last surviving owner is one who signed the beneficiary deed, then the property passes to the beneficiaries named in the beneficiary deed.¹⁶ The deed is invalid if the last surviving owner did not sign the beneficiary deed.¹⁷

If the property is not held with right of survivorship, meaning the owners hold it as tenants in common, then each owner’s property rights are freely transferable. No matter the order of death, each owner’s property rights will pass to the beneficiary named in a beneficiary deed signed by that owner.

What happens if the beneficiary named in an Arkansas beneficiary deed dies before the owner?

Unlike some states, the Arkansas beneficiary deed law does not require the beneficiary to outlive the owner. Instead, it allows the beneficiary deed to name backup beneficiaries, called alternate or contingent beneficiaries. It also allows the deed to state the conditions under which the property will pass to the alternate beneficiaries.¹⁸ The most common condition is a named beneficiary’s death before the death of the owner. In that case, the Arkansas beneficiary deed may name who will receive the property on the death of an owner if the originally named beneficiary is deceased.

Unlike most states that allow TOD deeds, Arkansas law clearly allows beneficiary deeds to name alternate beneficiaries by class (class gift).¹⁹ This means, for example, that an Arkansas beneficiary deed may name a child as a main beneficiary and then make that child’s children (the owner’s grandchildren) alternate beneficiaries without identifying each grandchild by name.

Must the owner notify the beneficiaries of the Arkansas beneficiary deed?

No. A beneficiary named in an Arkansas beneficiary deed does not get any legal property rights until the owner’s death.²⁰ While the deed must be recorded in the land records before the owner’s death, there is no legal requirement for the owner to tell the named beneficiaries about the deed.

Can an Arkansas beneficiary deed be used when the property is mortgaged?

Yes. An Arkansas beneficiary deed may be used for mortgaged property. Arkansas law is clear that a beneficiary who inherits property through an Arkansas beneficiary deed takes the property subject to all prior mortgages.²¹

Must an Arkansas beneficiary deed be recorded?

Yes. An Arkansas beneficiary deed is valid only if it is recorded before the death of the owner or the last surviving owner. It must be recorded in the Office of the County Recorder in the county where the real estate is located.²²

Can an Arkansas beneficiary deed be signed by an agent under a power of attorney?

Unlike the laws of some states, the Arkansas beneficiary deed statute is silent about the level of mental ability required to sign a beneficiary deed. It is best practice for the owner to sign the deed personally if he or she has the legal ability to do so. If the owner does not—for example, if the owner has dementia or is otherwise mentally disabled—then the law would not prevent an agent from signing the deed for the owner under a power of attorney. For this to work, the power of attorney must allow the agent to do so.

What are the requirements for an Arkansas beneficiary deed?

Arkansas beneficiary deeds must meet a handful of legal requirements that separate them from other types of Arkansas deeds:

• Effective at death. The beneficiary deed must clearly say that it does not take effect until the death of the owner or, if there are multiple owners, the death of the last owner to die.²³
• No consideration. The beneficiary deed must be “without current tangible consideration.” In other words, the beneficiary cannot pay the owner for the property transferred by the beneficiary deed. The beneficiary deed is intended only for gifts upon death.²⁴
• Recorded before death. The beneficiary deed must be recorded before the death of the owner or the last surviving owner. It is recorded in the Office of the County Recorder of the county where the real estate is located.²⁵
• Compliance with other laws. The beneficiary deed must “compl[y] with other applicable laws.” This includes the requirements—like a valid legal description—that apply to all Arkansas deeds.²⁶

The requirements for Arkansas beneficiary deeds differ from those of other states. It is important to use an Arkansas beneficiary deed form that has been designed to meet the requirements of Arkansas law. The use of generic, fill-in-the-blank forms that were not designed to meet Arkansas legal requirements may result in an invalid deed that a title insurance company will not insure.

1. See Ark. Code § 18-12-608.
2. See Ark. Code § 18-12-608(a)(1)(A).
3. See Ark. Code § 18-12-608(a)(1)(B)(ii).
4. See Ark. Code § 18-12-608(d)(1).
5. See Ark. Code § 18-12-608(a)(1)(B)(i).
6. See Ark. Code § 18-12-608(d)(1).
7. See Ark. Code § 18-12-608(d)(2).
8. See Ark. Code § 18-12-608(e).
9. See Ark. Code § 18-12-608(a)(1)(B)(i).
10. See Ark. Code § 18-12-608(d)(4).
11. See Ark. Code § 18-12-608(a)(1)(B)(i).
12. Id.
13. See Ark. Code § 18-12-608(a)(2)(A).
14. See Ark. Code § 18-12-608(a)(2)(B).
15. See Ark. Code § 18-12-608(b)(1).
16. Ark. Code § 18-12-608(b)(2)(A).
17. Ark. Code § 18-12-608(b)(2)(B).
18. Ark. Code § 18-12-608(a)(3)(B).
19. See Ark. Code § 18-12-608(a)(3)(A) (allowing the deed to name “one (1) or more unnamed heirs of the original grantee or grantees”).
20. Ark. Code § 18-12-608(a)(1)(B)(ii).
21. Ark. Code § 18-12-608(a)(1)(B)(i).
22. Ark. Code § 18-12-608(c)(1).
23. See Ark. Code § 18-12-608(a)(1)(A).
24. Id.
25. Ark. Code § 18-12-608(c)(1).
26. See Ark. Code § 18-12-608(h).