By Mia Poliquin Pross, Esq.

When Maine’s new Probate Code went into effect in the Fall of 2019, so too did the new statutory provisions allowing Transfer on Death Deeds (TODDs) in Maine.  These deeds convey real estate and are executed and filed with the county registry like normal deeds, but these deeds do not actually take effect until after the owner dies.  In the deed, the owner names a beneficiary they want to receive the real estate after the owner dies, which is similar to naming a beneficiary on an account or a life insurance policy.  The person or people named as beneficiary, inherit that property without it having to go through the probate process.

If a TODD is in place, while you’re alive, you still own the property and can do with it what you wish because the ownership has not changed.  You can also revoke the TODD if you change your mind.  But if you die while the TODD is in place, the ownership passes to the beneficiary.

For some people, these deeds work very well.  In my practice, I often meet with elderly people with modest estates where the only major asset is their home.  If they have a cohesive family and wish to simply pass the house to one or two children after death, a TODD can work well to reach their goal.  It does not create a gift during their lifetime (which can interfere with eligibility for public benefits like MaineCare for long term care) and it can be revoked, just like a will, if they change their minds.  But unlike using a will, the benefit here is that property subject to a TODD would not have to go through the probate process after death.  After the person dies, the beneficiary would file an affidavit of death in the county registry.  The beneficiary would also want to make sure the property was adequately insured after they inherit it.

That said, there are some situations where a TODD would not work well, and it is definitely not a “one size fits all” solution.  There are technical requirements and many nuances in the law.  For example, people should be aware that creditors of the deceased owner can still reach property that passes to a beneficiary through this type of deed.  Also, title insurers may require certain actions if the property is sold shortly after it is inherited.  If you are considering use of a TODD, you should consult an estate planning attorney before executing this type of deed.  A TODD could work well for you, or there may be other more appropriate strategies available for reaching your estate planning goals.

Article originally published in the Sun Journal’s Funeral and Estate Planning Guide, October 29, 2022.