SB 984

UNIFORM REAL PROPERTY TRANSFER ON DEATH ACT This bill creates the "Uniform Real Property Transfer on Death Act, "" which authorizes a n individual to transfer real property to one or more beneficiaries effective at the transferor's death by a transfer on death deed . The act applies to a transfer on death deed made before, on, or after July 1, 2025, by a transferor dying on or after July 1, 2025. However, the act does not affect any method of transferring real property otherwise permitted under state law. Capacity Th is bill provides that th e capacity required to make or revoke a transfer on death deed is the same as the capacity required to make a will. Requirements This bill requires a transfer on death deed to accomplish all of the following:  Contain t he essential elements and formalities of a properly recordable inter vivos deed .  S tate that the transfer to the designated beneficiary is to occur at the transferor's death .  B e recorded before the transferor's death in the public records in the office of the county register of deeds of the county where the real property is located. Notice, Delivery, Acceptance, Consideration This bill provides that a transfer on death deed is effective without ( i) n otice or delivery to, or acceptance by, the designated beneficiary during the transferor's life; or ( ii ) c onsideration. Revocability This bi ll provides that a transfer on death deed is revocable even if the deed or another instrument contains a contrary provision and it is nontestamentary. Revocation This bill provides that an instrument is effective to revoke a recorded transfer on death deed, or any part of it, only if the instrument (i) i s acknowledged by the transferor after the acknowledgment of the deed being revoked and recorded before the transferor's death in the public records in the office of the county register of deeds of the county where the deed is recorded, and (ii) is any of the following instruments:  A transfer on death deed that revokes the deed or part of the deed expressly or by inconsistency .  An instrument of revocation that expressly revokes the deed or part of the deed .  An inter vivos deed that expressly revokes the transfer on death deed or part of the deed . However, i f a transfer on death deed is made by more than one transferor, this bill provides that r evocation by a transferor does not affect the deed as to the interest of another transferor . A deed of joint owners is revoked only if it is revoked by all of the living joint owners. After a transfer on death deed is recorded, this bill prohibits revocation by a revocatory act on the deed. This bill does not limit the effect of an inter vivos transfer of the property. Effect of Transfer on Death Deed During Transferor's Life During a transferor ' s life, this bill provides that a transfer on death deed does not do any of the following:  Affect an interest or right of the transferor or any other owner, including the right to transfer or encumber the property .  Affect an interest or right of a transferee, even if the transferee has actual or constructive notice of the deed .  Affect an interest or right of a secured or unsecured creditor or future creditor of the transferor, even if the creditor has actual or constructive notice of the deed .  Affect the transferor's or designated beneficiary's eligibility for any form of public assistance unless required by federal law .  Create a legal or equitable interest in favor of the designated beneficiary .  Subject the property to claims or process of a creditor of the designated beneficiary. Effect of Transfer on Death Deed at Transferor's Death Except as otherwise provided in the transfer on death deed, in this bill, in present law pertaining to (i) d eath of a class member before time of enjoyment, (ii) e ffect of divorce, annulment, and decree of separation, (iii) e ffect of felonious and intentional killing of decedent, (iv) the Uniform Simultaneous Death Act, or (v) elective share of surviving spouse, this bill requires, upon the death of the transferor, the following rules to apply to property that is the subject of a transfer on death deed and owned by the transferor at death:  The interest of a designated beneficiary is contingent on the designated beneficiary surviving the transferor. The interest of a designated beneficiary that fails to survive the transferor lapses .  If the designated beneficiary surviv es the transferor, the interest in the property is transferred to and vests in the designated beneficiary in accordance with the deed .  C oncurrent interests are transferred to the beneficiaries in equal and undivided shares with no right of survivorship .  However, i f the transferor has identified two or more designated beneficiaries to receive concurrent interests in the property, the share of one that lapses or fails for any reason is transferred to the other, or to the others in proportion to the interest of each in the remaining part of the property held concurrently. Subject to certain present law provisions for authentication and registration of real property conveyances, this bill provides that a beneficiary takes the property subject to all conveyances, encumbrances, assignments, contracts, mortgages, liens, claims of the bureau of TennCare or successor entity for medical assistance, and other interests to which the property is subject at the transferor's death. For purposes of this bill and present law encompassing property rights, the recording of the transfer on death deed is deemed to have occurred at the transferor's death. For property with joint ownership, this bill provides the following:  I f a transferor is a joint owner and is survived by one or more other joint owners, then the property that is the subject of a transfer on death deed belongs to the surviving joint owner or owners with right of survivorship .  I f a transferor is a joint owner and is the last surviving joint owner, then the transfer on death deed is effective. This bill additionally provides that a transfer on death deed transfers property without covenant or warranty of title even if the deed contains a contrary provision. Disclaimer This bill authorizes a beneficiary to disclaim all or part of the beneficiary's interest as provided in the Tennessee Disclaimer of Property Interests Act . Delivery or Filing This bill authorizes delivery of a disclaimer to be effected by personal delivery, first-class mail, or any other method likely to result in its receipt. However, this bill provides other requirements for the following scenarios:  In the case of an interest created under the law of intestate succession or an interest created by will, other than an interest in a testamentary trust : (i) a disclaimer must be delivered to the personal representative of the decedent's estate; or (ii) if no personal representative is then serving, it must be filed with a court having jurisdiction to appoint the personal representative.  In the case of an interest in a testamentary trust : (i) a disclaimer must be delivered to the trustee then serving, or if no trustee is then serving, to the personal representative of the decedent's estate; or (ii) if no personal representative is then serving, it must be filed with a court having jurisdiction to enforce the trust.  In the case of an interest in an inter vivos trust : (i) a disclaimer must be delivered to the trustee then serving; (ii) if no trustee is then serving, it must be filed with a court having jurisdiction to enforce the trust; or (iii) if the disclaimer is made before the time the instrument creating the trust becomes irrevocable, it must be delivered to the settlor of a revocable trust or the transferor of the interest.  In the case of an interest created by a beneficiary designation that is disclaimed before the designation becomes irrevocable, the disclaimer must be delivered to the person making the beneficiary designation. Here, a ""beneficiary designation"" means an instrument, other than an instrument creating a trust, naming the beneficiary of: (i) a n annuity or insurance policy; (ii) an account with a designation for payment on death; (iii) a security registered in beneficiary form; (iv) a pension, profit-sharing, retirement, or other employment-related benefit plan; or (v) any other nonprobate transfer at death.  In the case of an interest created by a beneficiary designation that is disclaimed after the designation becomes irrevocable : (i) the disclaimer of an interest in personal property must be delivered to the person obligated to distribute the interest; and (ii) the disclaimer of an interest in real property must be recorded in the office of the county register of deeds of the county where the real property that is the subject of the disclaimer is located. A ""beneficiary designation"" here has the same meaning as above.  In the case of a disclaimer by a surviving holder of jointly held property, the disclaimer must be delivered to the person to whom the disclaimed interest passes.  In the case of a disclaimer by an object or taker in default of exercise of a power of appointment at any time after the power was created : (i) the disclaimer must be delivered to the holder of the power or to the fiduciary acting under the instrument that created the power; or (ii) if no fiduciary is then serving, it must be filed with a court having authority to appoint the fiduciary.  In the case of a disclaimer by an appointee of a nonfiduciary power of appointment : (i) t he disclaimer must be delivered to the holder, the personal representative of the holder's estate, or the fiduciary under the instrument that created the power; or (ii) i f no fiduciary is then serving, it must be filed with a court having authority to appoint the fiduciary.  In the case of a disclaimer by a fiduciary of a power over a trust or estate, the disclaimer must be delivered as provided above, as if the power disclaimed were an interest in property.  In the case of a disclaimer of a power by an agent, the disclaimer must be delivered to the principal or the principal's representative. Recording of Disclaimer If an instrument transferring an interest in or power over property subject to a disclaimer is required or permitted by law to be filed, recorded, or registered, then this bill authorizes the disclaimer to be so filed, recorded, or registered. Except as otherwise provided above, failure to file, record, or register the disclaimer does not affect its validity as between the disclaimant and persons to whom the property interest or power passes by reason of the disclaimer. Liability f or Creditor Claims a nd Statutory Allowances To the extent the transferor's probate estate is insufficient to satisfy an allowed claim against the estate or a statutory allowance to a surviving spouse or child, this bill authorizes the estate or any creditor to enforce the liability against property transferred at the transferor's death by a transfer on death deed. If more than one property is transferred by one or more transfer on death deeds, then the aforementioned liability is apportioned among the properties in proportion to their net values at the transferor's death. A proceeding to enforce such liability must be commenced not later than 1 8 months after the transferor's death. Form of Transfer on Death Deed This bill provides a form that may be used to create a transfer on death deed, which may be found in the full bill. The form generally outlines necessary information and frequently asked questions. Optional Form of Revocation This bill provides a form that may be used to create an instrument of revocation, which may be found in the language of the full bill. The form generally outlines necessary information and frequently asked questions. Uniformity of A pplication and C onstruction In applying and construing this bill, this bill requires consideration to be given to the need to promote uniformity of the law with respect to its subject matter among the states that enact it. Electronic Signatures This bill modifies, limits, and supersedes the federal Electronic Signatures in Global and National Commerce Act, but does not modify, limit, or supersede the act's requirements for consumer disclosures or authorize electronic delivery for certain notices described in the act, including court orders. TRANSFER OF VEHICLE TITLES Present law regulates how certificates of title for motor and other vehicles are transferred. This bill authorizes a n owner to provide for the transfer of title to a motor vehicle upon the owner's death by including in the certificate of title a designation of a beneficiary to whom the motor vehicle must be transferred upon the death of the owner, subject to the rights of all lie nholders. A trust may be a designated beneficiary. If a motor vehicle is jointly owned by two or more persons, then ownership of the motor vehicle must not vest in the designated beneficiary until the death of the last owner, subject to the rights of all lienholders. When a motor vehicle is jointly owned by two o r more persons, this bill requires the signatures of all owners to designate a beneficiary. Only one party's signature is required to designate a beneficiary if the title is registered in the name of one spouse or where the conjunction between the names on the title is ""or."" This bill requires a transfer on death certificate of title to include after the name of the owner, or owners, the words ""transfer on death to"" or the abbreviation ""TOD"" followed by the name of the beneficiary. This bill authorizes a beneficiary designation to be changed at any time without the consent of a beneficiary with the filing of an application for a subsequent transfer on death certificate of title and payment of the fee, which is currently $5.50 . Upon issuance of any such subsequent certificate of title, the previous certificate that was issued is void."