1. Introduction: Transfer-on-Death (TOD) in Georgia

Estate planning involves a host of legal tools that allow individuals to dictate how their assets will pass at death. Although wills and trusts are the cornerstone documents for many estates, beneficiary designations—such as Transfer-on-Death (TOD) arrangements—are increasingly popular. TOD enables real estate, LLC membership interests, and bank or brokerage accounts to pass directly to named beneficiaries (often called “designated grantee beneficiaries” or DGBs in Georgia’s new statute) without going through the probate process.

 

Why Consider TOD?

• Probate Avoidance: Assets transferred by TOD generally do not go through probate, so the beneficiary may gain access to them more quickly.
• Retained Control: A TOD deed does not give a beneficiary any present interest; the property owner can still sell, mortgage, or revoke the TOD arrangement at will.
• Potential Cost Savings: By avoiding (or minimizing) probate, a TOD structure may reduce legal fees and administrative expenses for your estate.

Despite these benefits, TOD designations (especially for real property) historically were not allowed in Georgia—at least not in the form that many other states had adopted. That changed with new laws that become effective on July 1, 2024.

 

2. New Law Effective July 1, 2024: Key Highlights

In the past, Georgia residents hoping to pass real estate via TOD were out of luck. While “lady bird deeds” (or “enhanced life estate deeds”) exist in some states, Georgia did not previously recognize a straightforward TOD deed for real property. However, under O.C.G.A. § 44-17-1 et seq., Georgia now explicitly authorizes TOD deeds for real estate and sets out comprehensive rules about how they work and how they can be revoked.

 

According to the newly enacted statute:

 

“Such deed shall transfer ownership of [the] interest upon the death of the record owner. A transfer-on-death deed need not be supported by consideration.”
—O.C.G.A. § 44-17-2(a)

 

Here are the principal takeaways from the law:

1. No Present Interest: The record owner retains complete ownership and control during their lifetime. The beneficiary has no rights until the owner’s death.
2. No Requirement to Notify the Beneficiary: The owner does not have to let the beneficiary know they have been named. The owner may also revoke or amend the TOD deed at any time, without beneficiary consent.
3. Affidavit Requirement: Upon the owner’s death, the beneficiary must record an affidavit (and death certificate) in the local Superior Court within specific deadlines—often within nine months—or risk losing the property interest. More on that below.
4. Sample Form in the Statute: The new law (O.C.G.A. § 44-17-3) provides a sample TOD deed, though it is not mandatory to use that exact form. Any valid form must be “substantially similar.”
5. Effective Date: The new law takes effect on July 1, 2024. Any attempt at a TOD deed before that date was not formally recognized—but the law does address some situations in which the owner died prior to July 1, 2024.

With this legal framework, Georgia officially joins many other states that allow real property transfers by TOD deed.

 

3. Requirements for a Valid TOD Deed

The statutory requirements for creating a valid TOD deed in Georgia include:

1. Proper Drafting: You must prepare a deed that expressly states it is a “transfer-on-death” deed, names the “record owner,” and designates the beneficiary or beneficiaries (the “DGBs”).
2. Signature & Witnesses: The record owner (or co-owners, if applicable) must sign the deed in the presence of two witnesses (one may be the notarial officer). See O.C.G.A. § 44-2-15 for details on officer attestation.
3. Recording: The TOD deed must be recorded in the county where the real estate is located. If it is not recorded, it does not create a valid TOD arrangement.
4. No Present Interest to Beneficiary: The deed must clarify that the owner keeps full ownership until death. The beneficiary has no immediate property rights.
5. No Need for Beneficiary’s Signature: Under O.C.G.A. § 44-17-2(b), the beneficiary does not need to sign or agree to the arrangement, nor does the owner have to notify the beneficiary.

Because the law is both new and detailed, it is highly recommended to seek help from a qualified attorney rather than attempt to prepare a TOD deed on your own. Mistakes could invalidate your transfer or lead to unintended consequences.

 

4. The 9-Month Rule: Claiming the Property After Death

One of the most noteworthy features in Georgia’s new TOD law is that the named beneficiary must affirmatively claim the property after the record owner’s death by filing an affidavit (with the death certificate attached) in the county land records:

 

“[A] DGB must execute an affidavit affirming (1) that the DGB has verified the record owner’s death, (2) whether the record owner and the DGB were married at the time of the record owner’s death, and (3) the legal description of the real estate.”
—O.C.G.A. § 44-17-2(c) & (d)

 

This affidavit must typically be filed within nine months of the owner’s death. If it is not filed in time, ownership reverts to the owner’s estate—meaning the beneficiary could lose the property. Crucially, there is no legal requirement that the beneficiary be notified of the owner’s death or the existence of the deed. As a result, many beneficiaries could unintentionally miss the filing deadline.

 

Practical Tips

• Encourage the beneficiary to keep in close contact with you (the owner) or with other family members who will promptly inform them of your death.
• Ensure the beneficiary knows where to locate the deed or at least that it exists.
• If there is a risk your beneficiary might struggle to obtain a death certificate (for example, the beneficiary is not a close family member), consider whether a will or trust-based plan might be more stable.

 

5. Co-Ownership and Spousal Concerns

Joint Tenants vs. Tenants in Common

If there are multiple owners on a piece of real estate:

• Joint Tenants With Rights of Survivorship: A TOD beneficiary generally only takes ownership after all joint tenants have died, because a joint tenant’s interest passes first to the other joint tenants. A TOD deed signed by one joint tenant alone does not extinguish the survivorship rights of the others.
• Tenants in Common: Each owner can separately designate a beneficiary for their undivided interest. One tenant in common can file or revoke a TOD deed on their share without consent from the other owners.

Marital Interests and Spouses

 

A TOD deed typically does not nullify or override certain spousal claims that arose before the deed was recorded. According to O.C.G.A. § 44-17-5(a), the property passes to the beneficiary “free and clear of any claims or interest as to a person who became the spouse of the record owner subsequent to the execution of the transfer-on-death deed” but remains subject to claims or interests of a spouse who existed prior to the TOD deed.

 

Homestead Exemption

 

Because the record owner remains the legal owner during life, the new law suggests that the homestead exemption should remain intact. Nonetheless, it is unclear how each of Georgia’s 159 counties will handle homestead exemption renewals when a TOD deed has been recorded. In principle, no present interest passes to the beneficiary before the owner’s death, so a county should not require any re-application. However, best practice is to confirm local procedures.

 

6. TOD for LLC Membership Interests

While the big news concerns real estate, LLC interests can also potentially transfer at death via a TOD-like method—but only if it aligns with the LLC’s operating agreement and Georgia’s laws. Many operating agreements have specific clauses about what happens on an owner’s death, such as:

• Automatic Transfer to Surviving Members
• Buy-Sell Provisions
• Right of First Refusal

If your LLC’s governing documents are silent on TOD transfers or require certain conditions, you must address those issues carefully. Sometimes, it may be simpler to pass an LLC interest through a revocable living trust or even a will, rather than attempt a TOD assignment.

 

Key Tip: If the operating agreement conflicts with any TOD provision you create, the operating agreement will often take precedence, potentially invalidating or complicating your beneficiary designation.

 

7. TOD/POD for Bank Accounts and Other Financial Instruments

Payable-on-Death (POD) Accounts

 

POD designations have long been recognized for bank accounts. Under O.C.G.A. § 7-1-810 et seq., an account owner can name a beneficiary, so the balance automatically passes outside of probate when the owner dies.

 

Brokerage and Investment Accounts

 

Many states (including Georgia) adopt some version of the Uniform TOD Security Registration Act, allowing you to designate beneficiaries for stocks, bonds, and mutual funds. The concept is the same as a POD: you retain control and the funds transfer to the beneficiary at death without probate.

 

Coordination Is Key

 

While each financial institution’s forms may differ, the underlying principle is the same: a beneficiary designation overrides your will for that specific account. Periodically review your designations—especially if you have gone through a divorce, remarriage, birth of a new child, or other major life changes.

 

8. The Importance of Beneficiary Designations

Why They Matter
Beneficiary designations—TOD, POD, retirement account beneficiaries, and life insurance beneficiaries—are legally binding instructions for how specific assets pass at death. They can (and often do) override what’s written in a will.

 

Avoiding Probate
One core reason people rely on TOD/POD designations is to skip probate for those assets. Probate can be time-consuming and public. A beneficiary can typically claim their asset directly from the financial institution or via an affidavit filed in the local land records (for real property).

 

Potential for Conflict
If your will says, “I leave my home to my three children in equal shares,” but you have recorded a TOD deed naming only one child as beneficiary, that child (assuming they timely file the required affidavit) will inherit the home—leaving the other two children out. This can easily lead to disputes or legal challenges if the family believes you intended to update your designations but never did.

 

Periodic Reviews
Set a reminder to check your beneficiary designations every couple of years—or whenever a significant life event occurs. You may also want to confirm that any new accounts you open carry over your chosen designations, as some institutions do not “port over” designations from old accounts automatically.

 

9. Potential Pitfalls and Risks of TOD

While TOD designations are often beneficial, they present certain risks that may not exist with more traditional approaches (such as a comprehensive will or trust):

1. Forgetting to Update
   Life can change quickly. If you designate your spouse as a TOD beneficiary, divorce, and then neglect to remove that ex-spouse, the ex-spouse may still inherit that asset. Wills in Georgia can sometimes automatically handle ex-spouse disinheritance, but TOD and POD forms do not self-adjust.
2. 9-Month Filing Deadline
   Under the new law, your beneficiary might lose the inherited real estate if they fail to file an affidavit (with a death certificate) within nine months of your death. Because no one is obligated to inform the beneficiary, it is very possible for a less-informed family member or friend to miss this deadline—causing the property to revert to your estate.
3. Unintended Disinheritance
   If you have multiple heirs but only name one child on the TOD deed (and do not coordinate your will accordingly), you could unintentionally give that one child a disproportionately large share of your estate.
4. Creditors and Liens
   A beneficiary typically takes property subject to any recorded encumbrances (e.g., mortgages, recorded liens, etc.). If there is an outstanding debt secured by the property, the beneficiary will need to settle it. On the other hand, certain creditors of the decedent may not be able to attach that asset if it transfers by TOD, which can have both positive and negative implications depending on the situation.
5. Title Insurance Questions
   While the new statute clarifies that a previously issued title insurance policy should remain in effect for the new beneficiary (absent an intervening deed), the practical details might vary with different title companies.
6. No Automatic “Lapse” Provisions
   If the beneficiary (DGB) dies before the property owner, that beneficiary’s interest under the TOD deed is generally deemed revoked. Georgia’s intestacy or standard “lapse” rules do not apply to TOD deeds—so you do not get an automatic gift to that deceased beneficiary’s children, for example, unless you specifically arrange it.

 

10. Practical Steps for Beneficiaries to Take Ownership

If you are named as a beneficiary under a TOD deed, here’s a general roadmap for what you must do after the property owner dies:

1. Obtain a Certified Copy of the Death Certificate
   This can be surprisingly difficult if you are not closely related. If the decedent’s family is uncooperative—or you simply do not realize you need it—you could run up against the nine-month deadline.
2. Prepare the Required Affidavit
   Under O.C.G.A. § 44-17-2(c) and (d), you must execute an affidavit affirming key facts (owner’s death, legal description of the property, marital status to the decedent, etc.).
3. Record the Affidavit
   You must file the affidavit in the Superior Court of the county where the property is located, attaching the death certificate. Missing the deadline can cause the property to revert to the estate.
4. Address Any Existing Liens or Mortgages
   You take the property subject to any recorded mortgages, liens, or easements. Confirm that payments remain current, and contact the lender if you plan to keep the property.
5. Update Insurance, Property Taxes, and Utilities
   Contact the insurer to add or convert the policy into your name. Notify tax assessors and utility companies of the change in ownership.
6. Consult Professionals
   Even though probate may be avoided for that piece of property, it is wise to consult a real estate attorney or estate planning professional for any tax implications or potential conflicts with other heirs.

 

11. Coordinating TOD Deeds With Wills, Trusts, and Other Estate Planning Tools

One of the biggest pitfalls in estate planning arises when someone sets up a TOD deed (or a POD account) that conflicts with their existing will or trust. Remember:

• A TOD/POD designation will override your will for that asset.
• If your trust (e.g., a revocable living trust) says your real estate should pass in equal shares to multiple beneficiaries, but your TOD deed names only one, the TOD deed controls, and the trust directions will be effectively negated for that property.
• Wills and trusts typically self-adjust through “lapse” or “per stirpes” provisions if a beneficiary dies before you. A TOD deed, by contrast, simply becomes revoked as to the deceased beneficiary, unless you have multiple beneficiaries named as joint tenants with rights of survivorship.

Revocations and Changes

 

Under O.C.G.A. § 44-17-4(a), you can revoke a TOD deed at any time by recording a revocation in the same county. You do not need beneficiary consent or even to notify them.
Likewise, you can change the beneficiary by recording a new TOD deed, which automatically revokes the previous designation.

 

Should You Rely on TOD Deeds Alone?

 

For some property owners, especially those with straightforward goals and a single piece of property, TOD deeds can be an elegant solution. For others, especially with more complex estates, beneficiaries who might forget the nine-month filing requirement, or situations requiring ongoing asset management, a revocable trust may be safer and more flexible. It’s important to weigh the pros and cons with professional guidance.

 

12. Conclusion

The new Georgia law (O.C.G.A. § 44-17-1 et seq.) allowing Transfer-on-Death deeds for real estate—effective July 1, 2024—opens up valuable opportunities for individuals looking to streamline their estate plans and bypass probate for certain assets. If used properly, TOD can ensure direct, relatively simple transfers for real estate, LLC interests, and financial accounts. However, there are critical rules and deadlines to understand:

• The 9-Month Deadline: Beneficiaries must file the required affidavit (with a death certificate) or risk losing the property to the deceased owner’s estate.
• No Notification Requirement: Owners do not have to tell beneficiaries about the TOD deed. Without careful communication, beneficiaries may remain unaware.
• Spousal and Creditor Issues: The property passes subject to any recorded liens, mortgages, or pre-existing spousal claims.
• Potential for Family Conflict: TOD designations that conflict with your will can create accidental disinheritances or uneven distributions.

Because these designations override what is written in your will or trust for those specific assets, it is critical to keep your entire estate plan cohesive and up to date. A mismatch between your TOD deeds, will, and trust can lead to confusion, legal challenges, and family strife. As with any new legal tool, there is a learning curve for the public, courts, and financial institutions—making professional assistance essential.

 

If you are considering whether a Georgia TOD deed (or a TOD arrangement for LLC interests, bank accounts, or brokerage portfolios) is right for you, consult with a qualified attorney who can ensure your documents comply with the new law and integrate seamlessly into your overall estate plan. Avoiding probate can be advantageous, but peace of mind ultimately depends on aligning each beneficiary designation with your true intentions and life circumstances.

 

About Slowik Estate Planning

 

At Slowik Estate Planning, we guide Georgia families through the complexities of modern estate planning. From wills and trusts to the latest Transfer-on-Death deed options, we provide customized solutions designed to protect your legacy. If you have questions about whether TOD is right for you, or if you need help ensuring your plan meets the new statutory requirements, reach out today to schedule a consultation. We’re here to help you create a plan that carries out your wishes with clarity and confidence.

 

Disclaimer: This post is intended for general informational purposes only. Laws and their interpretations change over time, and the new Georgia TOD deed laws (effective July 1, 2024) contain nuanced requirements. Always consult a qualified attorney before making decisions about your estate plan.