New Transfer-On-Death Deed
I am John Bennett, closing attorney and owner of Origin Title and Escrow.
Starting July 1, 2024, Georgia has a new type of deed. Georgia Code §44-17-1 through §44-17-7 prescribes a new type of deed known as the transfer-on-death deed. This is different from a deed that conveys title to people as joint tenants with right of survivorship in that the grantee has absolutely no ownership rights until the grantor passes away. This means that the grantee does not need to be present to sign any future loan documents or sales documents.
The transfer-on-death deed is void if the grantor conveys title to someone else. This new deed helps transfer title at death without going through probate, plus it keeps the ‘step up’ in value heirs get when inheriting property. The ‘step up’ in basis increases the tax basis of the property to the value of the property at the time it is inherited. This is very helpful in lowering the tax liability for heirs when inheriting property.
The owner may also revoke the transfer at any time by signing a revocation and recording it in the real estate records. The tricky part is that the revocation requires two witnesses plus the notary, like signing a will. (As a side note, the transfer-on-death deed may not be revoked by a will.)
The deed must be in a very specific form to be effective. One possible issue is that the transfer-on-death deed requires the grantee to file an affidavit in the real estate records that provides the marital status of both parties on the deed, the legal description of the real estate, and a copy of the grantor’s death certificate as verification that the grantor has passed away. This affidavit must be filed within nine months of the grantor’s death. If the affidavit is not recorded, then the real property becomes part of the estate of the deceased owner and the transfer-on-deed is useless. This extra step will require the grantee to know about the deed and the requirements to receive title to the property. This is not something most people will know to do.
The transfer-on-death deed is not a comprehensive estate plan. The deed must be in a very particular form to be valid. The grantee has the responsibility to file an affidavit in the real estate records to claim ownership of the property upon the grantor’s death, which could be 50 years in the future. For estate attorneys, or anyone probating an estate, the first step in probating an estate should be a title search to see how title is held and if the deceased filed a transfer-on-death deed.
John C. Bennett is a real estate closing attorney and owner of Origin Title and Escrow, Inc.. Since 2003, Origin Title has handled real estate transactions – purchases, refinances, reverse mortgages – quickly and professionally. There will be no surprises, nothing misunderstood. Title searches are thorough and well-reasoned, to avoid unpleasant surprises later down the road. Calculate your closing costs in Georgia or Florida using our calculator or contact Origin Title using this form.