The Illinois TOD deed form form allows property to be automatically transferred to a new owner when the current owner dies, without the need to go through probate. It also gives the current owner retained control over the property, including the right to change his or her mind about the transfer.
Special language is required to ensure that the deed qualifies as a TOD deed form. This language is automatically included by our deed preparation service and valid in all Illinois counties.
An Illinois transfer-on-death instrument (also known as an Illinois TOD deed form) transfers property automatically when a property owner dies. It functions in much the same way as a beneficiary designation on a bank account. If the transfer-on-death deed is properly signed, notarized, and filed, it operates to transfer real estate to the named beneficiary without the need to use a probate proceeding to transfer the property.
An Illinois transfer-on-death instrument can be thought of as a substitute for a will or trust. The Illinois Residential Real Property Transfer on Death Instrument Act requires the document to be signed like a will and provides that a valid Illinois transfer-on-death instrument will trump any contrary provisions in a will.
Although the Illinois Residential Real Property Transfer on Death Instrument Act uses the term transfer-on-death instrument, most states refer to this document as a transfer-on-death deed. The names are sometimes abbreviated so that a transfer-on-death instrument is called a TODI and a transfer-on-death deed is called a TOD deed. The document may also be referred to as a beneficiary deed, reflecting the fact that the essence of the document is the ability to name a beneficiary to inherit real estate.
Transfer-on-death deeds have several benefits that make them an attractive choice for Illinois property owners:
Transfer-on-death deeds also benefit the property owner’s beneficiaries by providing them with a simplified way to transfer the assets quickly and at a low cost.
Special rules apply when more than one owner owns the same property. If property is held as joint tenancy with right of survivorship or tenancy in common, the property will continue to be owned in that way while the owners are still alive. If a joint owner dies and is survived by another joint owner, his or her interest will pass to the surviving joint owner, not to the beneficiary named in the transfer-on-death deed. The beneficiary named in the transfer-on-death deed does not inherit until all joint owners have died.
For a transfer-on-death deed to be effective to transfer property on the death of the last surviving owner, the last surviving owner must have signed the document. If the last surviving owner did not sign the document, the property passes to the surviving owner’s estate instead of passing to the beneficiary named in the transfer-on-death deed.
Transfer-on-death deeds are not available if multiple owners hold title as tenants in common.
The Illinois Residential Real Property Transfer on Death Instrument Act limits the circumstances in which an Illinois transfer-on-death deed can be used to transfer real estate. In Illinois, a transfer-on-death deed can be used:
An Illinois transfer-on-death deed cannot be used:
Because a transfer-on-death deed takes effect at death, it must be signed and delivered like a will. This requires the property owner to sign the deed in front of two credible witnesses, who also sign the deed and represent that the owner:
A licensed notary public must also acknowledge the signature of both the owner and the two witnesses.
For the transfer-on-death deed to be effective, the owner must record it the in the office of the public records for the county or counties where the property is located. This is an essential requirement that, if overlooked, could invalidate the deed.
There is no need to notify the beneficiary that the deed has been signed and recorded, but the owner may consider doing so just to let the beneficiary know to claim the property after the owner dies.
A transfer-on-death deed does not provide the beneficiary with a warranty of title. If there is a title problem with the property, the beneficiary is responsible for completing any actions necessary to clear title to the property.
The lack of a warranty of title makes the transfer-on-death deed similar to an Illinois quitclaim deed, which also provides no warranty of title and which is also used in the gift context. It also distinguishes transfer-on-death deeds from both special warranty deeds and warranty deeds, each of which provides a warranty of title.
An Illinois transfer-on-death deed form is an alternative to a life estate deed. Like a transfer-on-death deed, a life estate deed transfers property at death. But life estate deeds have a significant drawback: They immediately transfer a remainder interest in the property to the beneficiary when the deed is signed. This means that the current owner must get the consent of the beneficiary before changing or revoking the deed. A transfer-on-death deed avoids this problem by giving the current owner continued control over the property during his or her life.
Although Illinois transfer-on-death deeds serve the same purpose as lady bird deeds (also known as ladybird deeds or enhanced life estate deeds), the two documents are different. Lady bird deeds are only recognized in a handful of states—including Florida, Texas, Michigan, Vermont, and West Virginia—and are a specialized type of life estate deed. Illinois does not recognize lady bird deeds.
The Illinois Residential Real Property Transfer on Death Instrument Act requires all Illinois transfer-on-death deeds to be drafted as provided in the language of the statute. This requires that the transfer:
The deed must also contain a properly drafted legal description and meet the other requirements for validity of a deed.
As with other forms of deed, failure to meet the statutory requirements could invalidate the deed or, perhaps worse, require costly legal proceedings to resolve inconsistencies in the document. The deeds prepared by Deed Generator were designed specifically to comply with the Illinois Residential Real Property Transfer on Death Instrument Act. We also include step-by-step instructions for completing the transfer with the county once the document is signed.