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What is a Transfer on Death Instrument in Estate Planning?

Exploring more affordable and efficient options to transfer assets to heirs is a growing trend in estate planning. Individuals and families are discovering Transfer on Death (TOD) instruments, game-changers that simplify the inheritance distribution process and avoid the often confusing probate process. TOD instruments are now a legal option in 29 states, including Illinois. The ABA Journal article, “Less-expensive transfer on death instruments become more popular in Chicago,” noted the use of TOD instruments in Cook County, Illinois, including Chicago. This article explains the increasing interest in TODs and why they might be a good estate planning strategy, depending on where you live.

Estate Planning - How Transfer on Death Instruments Can Prevent a ‘Tangled Title’

Homeowners can jeopardize the transfer of their home to a beneficiary if they don't have a will, trust, or TOD instrument in place before their death. Without a legal document to confirm an heir’s claim to your property and a property title in the deceased’s name, a probate court may not transfer the home to the deceased’s intended heir.

Often called a “tangled title,” this title issue complicates the probate process, as the court tries to confirm a beneficiary’s legal claim to the property. Preventing tangled titles or the probate process is shining a spotlight on transfer on death instruments as a preferred choice for homeowners looking to streamline the transfer of their assets to beneficiaries.

Tangled title complications are costly to heirs. They must pay a bond of 1.5 times the estate value to act as the estate representative in the probate court proceedings. The heir also runs the risk of the home foreclosing while they find and notify all family members who have a legal entitlement to that home.

The Benefits of Transfer on Death Instruments

The appeal of TOD instruments lies in their simplicity and affordability. By designating beneficiaries directly on the deed, property owners can seamlessly transfer their assets to their loved ones upon their passing. TOD instruments minimize the risk of legal disputes and delays associated with probate proceedings.

Proactive homeowners who intend to leave their property to an heir or heirs can consider a TOD for a quick and painless transfer. This less expensive strategy is poised to help more individuals and families leave legacies for many generations to come.

Key Takeaways:

  • Benefits of TOD Instruments: A cost-effective solution that preserves intergenerational wealth in an accessible avenue for individuals to safeguard their assets and leave a lasting legacy for future generations.
  • Tangled Titles: Real estate title issues complicate the probate process, as the court tries to confirm a beneficiary’s legal claim to the property.
  • Prevent a Tangled Title: Transfer on death instruments eliminate the need for the probate process.
  • Empowering Homeowners: Homeowners take control of their financial futures and protect their legacies for future generations.


Unlike traditional wills or trusts, TOD instruments bypass the need for probate and mitigate the risk of a "tangled title" scenario. They are a cost-effective and efficient alternative to traditional asset transfer methods that preserve intergenerational wealth and leave a lasting legacy for future generations. Book a call with Vick Law, P.C. today to ensure you have the plan the best fits your needs.

Reference: ABA Journal (Nov. 30, 2023) “Less-expensive transfer on death instruments become more popular in Chicago.”

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