Missouri Beneficiary Deed Form

What is a Missouri transfer-on-death (TOD) deed?

A Missouri transfer-on-death deed form—technically called a Missouri beneficiary deed form—is a written document that transfers real estate effective at the owner’s death. A beneficiary deed works in much the same way as a POD or TOD designation on a bank account. The owner retains complete control over the property during life. The owner can sell the property or change the beneficiary designation without involving the beneficiary.¹ At the owner’s death, the property passes to the beneficiary without the need for probate.²

The Missouri beneficiary deed is authorized by the Nonprobate Transfers Law of Missouri—which uses (but does not specifically require) the term beneficiary deed.³ Missouri is one of a handful of states—including Arizona, Arkansas, and Colorado—that primarily use the name beneficiary deed for this type of deed. Most other states use the term ­transfer-on-death deed or TOD deed for the same type of instrument—as does the Uniform Real Property Transfer on Death Act that is the model for many state TOD laws.

What is the purpose of a Missouri beneficiary deed?

The principal purpose of a Missouri beneficiary deed is to transfer property effective at the owner’s death without going through probate.⁴ When the owner dies, the property passes directly to the beneficiary named in the deed. The owner’s will does not affect a property that is subject to a valid beneficiary deed.

Beneficiary deeds offer several additional advantages along with avoiding probate. These benefits make beneficiary deeds a valuable tool for efficiently transferring real estate when the owner dies.

• Retained control. An owner that makes a Missouri beneficiary deed keeps complete control over the property during life. He or she can sell or mortgage the property without notifying the beneficiaries. The owner can also freely change or revoke the beneficiary designation.⁵
• Local tax and legal benefits. A transfer under a Missouri beneficiary deed form does not become effective until the owner’s death. Because official ownership is unchanged during the owner’s life, the property continues to qualify for any tax and legal benefits it receives before the beneficiary deed is recorded. The benefits can potentially include a Missouri homestead exemption or favorable property tax statuses.
• Federal tax savings. A recorded beneficiary deed is fully revocable, so it is not considered a completed gift under IRS rules. As a result, no gift tax is owed when the deed is recorded. The property is still in the owner’s taxable estate for estate-tax purposes, and it therefore qualifies for a basis step-up at the owner’s death. The step-up avoids income tax liability for increases in the property’s value during the owner’s life. The property also continues to qualify for the federal home sale exclusion.
• Lower legal fees. Many benefits of a Missouri beneficiary deed form can also be obtained by transferring the real estate to a living trust. A living trust, though, is a more complex estate-planning strategy and often requires a lawyer’s assistance and thousands of dollars in legal fees. A Missouri beneficiary deed form avoids this legal hassle and expense.

What is the benefit of avoiding probate?

A Missouri beneficiary deed keeps the real estate out of probate. The probate process is often complicated and expensive. Avoiding probate reduces the cost and difficulty of estate administration. Probate is also a public process, so bypassing probate promotes privacy.

Although a beneficiary deed keeps the property subject to the deed out of probate, the owner’s other assets may still need to go through probate. Even if that is the case, the beneficiary deed will reduce the difficulty of administering the probate estate and usually lets the beneficiary officially take title sooner than if the property passed through probate.

What types of property can be transferred using a Missouri beneficiary deed?

A Missouri property owner can use a beneficiary deed to transfer an ownership interest in Missouri real estate effective on the owner’s death.⁶ The owner does not necessarily have to hold complete (fee simple) ownership, as long as the owner would otherwise have the right to transfer the real estate interest by will when the owner dies. An owner who co-owns real estate with another co-owner can use a beneficiary deed—though rights of survivorship (if applicable) take precedence over a beneficiary deed. The rules for beneficiary deeds from co-owners are described further below.

An individual who owns Missouri real estate but does not live in Missouri can record a Missouri beneficiary deed for the property. A Missouri resident cannot use a Missouri beneficiary deed to transfer real estate located in another state, but he or she may be able to use a transfer-on-death deed created under the other state’s law.

What Is the effect of a Missouri beneficiary deed while the owner Is alive?

A beneficiary deed has no legal effect while the property owner is still living. The owner can sell, transfer, or mortgage the property without the beneficiary’s consent.⁷ The owner also has the right to amend or revoke the beneficiary deed until his or her death.⁸

The beneficiary receives no rights in the property during the owner’s life, so the property is not subject to claims of the beneficiary’s creditors while the original owner is living.

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

Yes. The owner has the same right to sell or otherwise transfer the property after recording a TOD deed that the owner had before recording it.⁹ There is no need to notify the beneficiary of a sale or to obtain the beneficiary’s signature on a deed that transfers the property.

Is a Missouri beneficiary deed revocable?

A Missouri property owner who records a beneficiary has the right to revoke the deed, in whole or in part, until the owner’s death.¹⁰ The owner can revoke a beneficiary deed by:

• Recording another instrument that expressly revokes the beneficiary deed;
• Recording another beneficiary deed that changes the beneficiary designation; or
• Selling or transferring the property during the owner’s life.

A document that revokes a beneficiary deed must be recorded, and the revocation must comply with any revocation terms listed in the beneficiary deed.¹¹ An owner may not revoke or amend a beneficiary deed by will unless the will expressly gives the owner the right to make the revocation or amendment by will.¹²

What Is the effect of a Missouri TOD deed when the owner dies?

When the owner dies, title to the real estate automatically passes to the beneficiary by operation of law—with no need for probate.¹³ The beneficiary takes title subject to any liens, mortgages, or other third-party interests affecting the property made during the owner’s lifetime.¹⁴ This means that a lien or mortgage on the property before the owner’s death will remain attached to the property after the transfer.

The deceased owner’s creditors, surviving spouse, and minor children may have rights in the value of the property if the deceased owner’s probate estate is insufficient to cover statutory support allowances and creditor claims against the estate.¹⁵

A beneficiary has the right to disclaim (i.e., decline to accept) the real estate that would otherwise pass under a beneficiary deed.¹⁶ If a beneficiary disclaims the interest, the property is treated as though the beneficiary had died before the property owner.

Can a Missouri beneficiary deed leave property to multiple beneficiaries?

Yes. A Missouri beneficiary deed can name one or multiple beneficiaries. A beneficiary can be a living individual, a business entity that can own real estate, or a fiduciary.¹⁷ A beneficiary can name a trust’s trustee or co-trustees as beneficiary.¹⁸

The default rule is that a Missouri beneficiary deed that names multiple beneficiaries transfers the property to them in separate, equal interests as tenants in common.¹⁹ After co-beneficiaries receive the property as tenants in common, each beneficiary’s interest will pass to his or her probate estate at death (not to the other surviving beneficiary).

A beneficiary deed can expressly provide that the property will transfer to the beneficiaries as joint tenants with a right of survivorship. The deed must state that there is a right of survivorship between the beneficiaries.

Can joint owners sign a Missouri TOD deed?

It is not uncommon for multiple owners—most often married couples—to own Missouri real estate. Missouri law allows co-owners to record beneficiary deeds. The rules for how a beneficiary deed works for co-owned property depend on the form of co-ownership that the owners use—specifically, whether they have a right of survivorship.

• No right of survivorship (tenancy in common). If the co-owners are tenants in common, they have no right of survivorship, and each co-owner can transfer his or her interest separately. An interest owned by a tenant in common who records a beneficiary deed passes directly to the beneficiary when the tenant in common dies—even if the other co-owner is still living.²⁰
• Right of survivorship (joint tenancy or tenancy by the entirety). If two or more joint owners who hold title with a right of survivorship make a beneficiary deed, the right of survivorship takes priority over the beneficiary designation.²¹ That means that ownership does not pass to the beneficiary until the death of the last surviving co-owner.²² When the first co-owner dies, the deceased owner’s interest passes to the surviving co-owner due to the right of survivorship.

What happens if the beneficiary named in a Missouri TOD deed dies before the owner?

Under Missouri’s default rules for beneficiary designations, a beneficiary does not inherit under a beneficiary deed unless he or she survives the owner by at least 120 hours.²³ A beneficiary designation fails (or lapses) if the beneficiary fails to survive the owner. If the beneficiary designation lapses, the property interest instead passes to the property owner’s probate estate.²⁴

The default rules can be changed by language in the deed, and Missouri law specifically authorizes several strategies to prevent a lapse:

• Naming the owner’s descendant as beneficiary. If a beneficiary is a descendant of the owner (for example, a child or grandchild), then the property passes to the deceased beneficiary’s descendants (if any).²⁵ An owner who names a descendant as beneficiary can include the notation “no lineal descendant per stirpes” (or “no LDPS”) to avoid a transfer to the beneficiary’s descendant if the beneficiary predeceases the owner.
• Naming multiple beneficiaries. If a beneficiary deed names multiple beneficiaries, a deceased beneficiary’s interest passes to a surviving beneficiary (unless the deceased beneficiary has a descendant who has a right to receive the share).²⁶
• Naming a substitute beneficiary. A Missouri beneficiary deed can name a substitute beneficiary (or contingent beneficiary) who receives a beneficiary’s share if the beneficiary predeceases the property owner.²⁷
• Including lineal descendants per stirpes (LDPS) notation. An owner can effectively name a substitute beneficiary by including the notation “lineal descendants per stirpes” (or “LPDS”).²⁸ The LPDS notation defeats lapse by allowing a non-surviving beneficiary’s descendant to take title in the deceased beneficiary’s place.²⁹ The LPDS notation works even if the primary beneficiary is not the property owner’s descendant.

If a beneficiary deed uses more than one anti-lapse strategies, the order of priority if a primary beneficiary dies before the owner is (i) lineal descendants with a right to the deceased beneficiary’s interest, (ii) surviving primary beneficiaries, (iii) contingent beneficiaries, and (iv) the property owner’s estate.³⁰

Must the owner notify the beneficiaries of the Missouri TOD deed?

Missouri law does not require the owner to provide notice of a beneficiary deed to the named beneficiary or to provide the beneficiary deed to the beneficiary.³¹ However, it may be helpful to let the beneficiary know about the beneficiary deed so that he or she is prepared to become the property owner when the current owner dies.

Can a Missouri TOD deed be used when the property is mortgaged?

An existing mortgage does not prevent a property owner from using a Missouri beneficiary deed. Mortgage agreements typically include due-on-sale provisions that restrict the owner’s right to transfer the property without the lender’s consent. Recording a beneficiary deed does not offend these provisions, though, because a beneficiary deed does not transfer the property during the owner’s life.³²

A beneficiary deed does transfer title when the owner dies, but there is a federal law that prohibits lenders from enforcing due-on-sale provisions in response to “a transfer to a relative resulting from the death of a borrower.”³³

Missouri beneficiary deeds do not impair a mortgage lender’s rights. The mortgage remains effective during the owner’s life as though no beneficiary deed were recorded, and the mortgage survives the transfer to the beneficiary at the owner’s death.³⁴ The beneficiary may need to make arrangements with the lender if the loan secured by the mortgage is not satisfied during the estate-administration process.

Must a Missouri beneficiary deed be recorded?

Recording is an absolute requirement for an effective beneficiary deed.³⁵ The deed must be recorded:

• With the county recorder for the city or county where the property is located;
• Before the owner’s death.

An otherwise valid beneficiary deed is ineffective to transfer the property if the deed is not recorded during the owner’s life.

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

Missouri law allows an agent under power of attorney to create a beneficiary deed under limited circumstances. An agent can sign a Missouri beneficiary deed on a property owner’s behalf only if:

• The agent is appointed by the property owner under a validly executed and recorded power-of-attorney (POA) instrument;
• The POA instrument expressly gives the agent the power to create a beneficiary deed for the property owner; and
• The agent complies with any requirements, limitations, or other terms listed in the POA instrument.³⁶

What are the requirements for a Missouri TOD deed?

Missouri beneficiary deeds are authorized by statute and must meet the requirements of the authorizing statute to be valid. Unlike some states, Missouri does not have a statutorily approved TOD deed form. Requirements for an effective beneficiary deed include the following:

• Owner and beneficiary. A beneficiary deed must identify the property owner and designate one or more beneficiaries.³⁷
• Effective at death. A beneficiary deed must have special language to ensure that the transfer is effective only upon the owner’s death.³⁸ The words transfer on death or the abbreviation TOD can be used for this purpose.³⁹
• Date and signature. A beneficiary deed must be dated, and it must be signed by the owner.⁴⁰
• Recording. The deed must be filed with the recorder of deeds in the city or county where the property is located prior to the death of the owner.⁴¹
• General Missouri deed requirements. A beneficiary deed must also meet the general requirements for all valid, recordable Missouri deeds—such as a title, correct formatting, a legal description of the property, and a notary acknowledgment.⁴² A Missouri beneficiary deed need not include a statement of consideration and need not be delivered to the beneficiary.

A Missouri beneficiary deed must be designed to meet the requirements of Missouri real estate and transfer-on-death laws. A TOD deed designed for use in another state is unlikely to make an effective transfer of Missouri real estate. Even minor deviations from legal requirements can make a deed unrecordable or lead to significant unintended legal consequences.

1. Mo. Rev. Stat. § 461.031(1).
2. Mo. Rev. Stat. § 461.031(3).
3. Mo. Rev. Stat. §§ 461.001, et. seq.
4. Mo. Rev. Stat. § 461.031(3).
5. Mo. Rev. Stat. § 461.033(1).
6. Mo. Rev. Stat. § 461.025(1).
7. Mo. Rev. Stat. § 461.031(1).
8. Mo. Rev. Stat. § 461.033(1).
9. Mo. Rev. Stat. § 461.031(1).
10. Mo. Rev. Stat. § 461.033(1).
11. Mo. Rev. Stat. § 461.033(3).
12. Mo. Rev. Stat. § 461.033(4).
13. Mo. Rev. Stat. § 461.031(3).
14. Mo. Rev. Stat. § 461.039(1).
15. Mo. Rev. Stat. §§ 461.071; 461.300.
16. Mo. Rev. Stat. § 461.048.
17. Mo. Rev. Stat. § 461.005(10).
18. Mo. Rev. Stat. § 461.043(1).
19. Mo. Rev. Stat. § 461.031(4).
20. Mo. Rev. Stat. § 461.025(1).
21. Mo. Rev. Stat. § 461.031(2).
22. Mo. Rev. Stat. § 461.005(5).
23. Mo. Rev. Stat. § 461.042(1).
24. Mo. Rev. Stat. § 461.031(5).
25. Mo. Rev. Stat. § 461.045(1).
26. Mo. Rev. Stat. § 461.062(3)(9)(a).
27. Mo. Rev. Stat. § 461.062(3)(3).
28. Mo. Rev. Stat. § 461.005(6).
29. Mo. Rev. Stat. § 461.045(2).
30. Mo. Rev. Stat. §§ 461.045(5); 461.062(3)(9)(a).
31. Mo. Rev. Stat. § 461.025(1).
32. Mo. Rev. Stat. § 461.031(1).
33. See Garn-St. Germain Depository Institutions Act of 1982, 12 USC 1701j-3(d).
34. Mo. Rev. Stat. § 461.039(1).
35. Mo. Rev. Stat. § 461.025.
36. Mo. Rev. Stat. §§ 461.035(1); 442.360.
37. Mo. Rev. Stat. § 461.005(9).
38. Mo. Rev. Stat. § 461.025.
39. Mo. Rev. Stat. § 461.005(15).
40. Mo. Rev. Stat. § 461.062(3)(1).
41. Mo. Rev. Stat. § 461.025.
42. See, e.g., Mo. Rev. Stat. §§ 59.005; 59.310.2; 59.330.2.