Every state allows transfer on death accounts for bank and brokerage assets, but only 33 states and the District of Columbia allow a transfer on death (TOD) deed for real estate. That split is the first thing to pin down before you plan around TOD: the designation is nearly universal for money, state-specific for property.
Financial Accounts: All 50 States
Bank, brokerage, and other securities accounts accept TOD or payable on death (POD) designations everywhere in the country. Banks usually call them POD accounts; brokerage firms use the TOD label. Either way, you name a beneficiary, keep full control of the money while you’re alive, and the funds pass directly to that person at your death without probate. Most states built this framework from some version of the Uniform TOD Security Registration Act.
While you’re alive, nothing changes. You can spend the money, close the account, or swap in a different beneficiary. The person you name has no legal claim until you die.
States That Allow TOD Deeds for Real Estate
A TOD deed (also called a beneficiary deed in some states) names someone to inherit your real property at death, again without probate. It doesn’t transfer any ownership while you’re alive. These states and the District of Columbia currently allow some form of TOD deed:
- Alaska, Arizona, Arkansas, California, Colorado, Delaware
- Georgia, Hawaii, Illinois, Indiana, Kansas, Maine
- Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada
- New Hampshire, New Mexico, New York, North Dakota, Ohio, Oklahoma
- Oregon, South Dakota, Texas, Utah, Virginia, Washington
- West Virginia, Wisconsin, Wyoming
Several of these states adopted the Uniform Real Property Transfer on Death Act. Others wrote their own statutes. The rules are not uniform even among states that allow TOD deeds. Some require specific statutory forms, some impose waiting periods, and recording requirements vary. Check your state’s version before drafting anything.
The step people forget is recording. A signed, notarized TOD deed sitting in a drawer has no legal effect. You must record it with the county recorder’s office in the county where the property sits before you die. Recording fees generally run between $15 and $100.
If the Property Is in Joint Tenancy
A TOD deed only controls property you own outright or as a tenant in common. If you hold title as joint tenants with right of survivorship, the surviving co-owner takes the property automatically at your death, and the TOD beneficiary gets nothing. Confirm how your deed is titled before recording a TOD deed over it.
If Your State Doesn’t Allow TOD Deeds
Roughly 17 states don’t authorize TOD deeds for real estate. If your property is in one of those states, three alternatives keep the house out of probate:
- A revocable living trust. You transfer the property into the trust during your lifetime, and the trust document names who inherits at your death. More paperwork and cost than a TOD deed, but it works in every state.
- Joint tenancy with right of survivorship. You add the intended heir as a co-owner now. The property passes to them automatically at your death. The trade-off is real: they get a present ownership interest immediately, their creditors can attach a lien, and you lose sole control.
- An enhanced life estate deed, sometimes called a Lady Bird deed. Available in a handful of states, it lets you keep full control during your lifetime while naming a remainder beneficiary. It functions much like a TOD deed under different legal authority.
Other Assets That Can Carry a TOD Designation
TOD and POD aren’t limited to cash accounts and houses:
- Bank accounts use a POD designation. Available in all states.
- Brokerage and investment accounts use the TOD designation. Available in all states for securities.
- Real estate requires a TOD deed, available only in the states listed above.
- Vehicles can carry TOD designations on the title in some states. Where allowed, the owner files a beneficiary affidavit with the motor vehicle agency and the title transfers at death without probate.
- U.S. savings bonds can name a co-owner or beneficiary. A bond with a named beneficiary passes directly to that person and doesn’t become part of the estate.1TreasuryDirect. Death of a Savings Bond Owner
Retirement Accounts Work Differently
IRAs, 401(k)s, and other retirement accounts have their own beneficiary designation systems that function like TOD transfers, but the inheritance rules are not the same. Under the SECURE Act, most non-spouse beneficiaries who inherit a retirement account from someone who died after 2019 must empty the account within 10 years of the original owner’s death.2Internal Revenue Service. Retirement Topics – Beneficiary Only “eligible designated beneficiaries” (surviving spouses, minor children of the deceased, disabled or chronically ill individuals, and people no more than 10 years younger than the account owner) can stretch distributions over their own life expectancy. If a retirement account is a major piece of your plan, the distribution timeline matters as much as the choice of beneficiary.
Setting Up the Designation
Financial Accounts
Contact the bank or brokerage and ask for a beneficiary designation form. You’ll provide the beneficiary’s full legal name, date of birth, and Social Security number. Most firms let you name contingent beneficiaries who inherit if the primary beneficiary dies before you do. The form takes a few minutes and usually doesn’t need notarization, though some institutions ask for a signature guarantee.
Real Estate
A TOD deed has to meet your state’s statutory requirements, which generally include the legal property description, the names of all current owners, and the named beneficiaries. Most states require notarization. Then record it with the county recorder’s office before your death. Without recording, the deed does nothing.
A TOD Designation Overrides Your Will
This one catches people constantly. If your will says your daughter inherits your brokerage account but the TOD form on file names your brother, your brother gets the account. The financial institution follows the beneficiary designation. A will has no authority over assets controlled by a TOD or POD designation. Review your beneficiary forms whenever you update your will, go through a divorce, or hit any major life change.
Divorce: Another State-by-State Split
Roughly 35 states have “revocation upon divorce” statutes that automatically void beneficiary designations naming a former spouse, including TOD and POD accounts. About 26 of those states make the revocation fully automatic. In states without these protections, your ex-spouse stays the named beneficiary until you file a new designation, and if you die without updating it, they inherit.
One exception cuts across all states: ERISA-governed plans like 401(k)s and pensions follow federal rules, not state revocation-upon-divorce statutes. For those accounts, a pre-divorce beneficiary designation stays in place regardless of state law until you actively change it.
Spousal Elective Share
Most states give a surviving spouse the right to claim a minimum share of the deceased spouse’s estate even when the will or beneficiary designations say otherwise. In the majority of states, TOD and POD accounts count toward this “elective share” calculation. Naming a sibling as the TOD beneficiary on all your accounts won’t fully disinherit your spouse: your spouse can claim a portion anyway. The percentage and the calculation method vary by state.
Changing or Revoking a TOD Designation
You can change or cancel a TOD designation at any time while you’re alive and competent. For financial accounts, submit a new beneficiary form to the institution; the new form automatically replaces whatever was on file.
For real estate, revocation takes one of two forms. You can record a formal revocation document (often called an instrument of revocation) with the same county recorder’s office where the original TOD deed was filed. Or you can execute and record a new TOD deed naming different beneficiaries, which cancels the prior one. Either document has to be recorded to be effective, just like the original deed.