HF 816 (LSB 1026YH (1) 91)

HOUSE FILE 816

BY  CROKEN

A BILL FOR

An Act relating to creation of transfer on death deeds and to disclaimers of an interest in real property.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  NEW SECTION.  633G.1  Short title.
   This chapter may be cited as the “Uniform Real Property Transfer on Death Act”.
    Sec. 2.  NEW SECTION.  633G.2  Definitions.
   As used in this chapter, unless the context otherwise requires:
   1.  “Beneficiary” means a person that receives property under a transfer on death deed.
   2.  “Designated beneficiary” means a person designated to receive property in a transfer on death deed.
   3.  “Joint owner” means an individual who owns property concurrently with one or more other individuals with a right of survivorship. “Joint owner” includes a joint tenant and tenant by the entirety. “Joint owner” does not include a tenant in common.
   4.  “Person” means an individual, corporation, business trust, estate, trust, partnership, limited liability company, association, joint venture, public corporation, government or governmental subdivision, agency, or instrumentality, or any other legal or commercial entity.
   5.  “Property” means an interest in real property located in this state which is transferable on the death of the owner.
   6.  “Transfer on death deed” means a deed authorized under this chapter.
   7.  “Transferor” means an individual who makes a transfer on death deed.
    Sec. 3.  NEW SECTION.  633G.3  Applicability.
   This chapter applies to a transfer on death deed made before, on, or after the effective date of this Act by a transferor dying on or after the effective date of this Act.
    Sec. 4.  NEW SECTION.  633G.4  Nonexclusivity.
   This chapter does not affect any method of transferring property otherwise permitted under the law of this state. 
    Sec. 5.  NEW SECTION.  633G.5  Transfer on death deed authorized.
   An individual may transfer property to one or more beneficiaries effective at the transferor’s death by a transfer on death deed.
    Sec. 6.  NEW SECTION.  633G.6  Transfer on death deed revocable.
   A transfer on death deed is revocable even if the deed or another instrument contains a contrary provision.
    Sec. 7.  NEW SECTION.  633G.7  Transfer on death deed nontestamentary.
   A transfer on death deed is nontestamentary.
    Sec. 8.  NEW SECTION.  633G.8  Capacity of transferor.
   The capacity required to make or revoke a transfer on death deed is the same as the capacity required to make a will.
    Sec. 9.  NEW SECTION.  633G.9  Requirements.
   A transfer on death deed:
   1.  Except as otherwise provided in subsection 2, must contain the essential elements and formalities of a properly recordable inter vivos deed.
   2.  Must state that the transfer to the designated beneficiary is to occur at the transferor’s death.
   3.  Must be recorded before the transferor’s death in the public records in the office of the county recorder in the county where the property is located.
    Sec. 10.  NEW SECTION.  633G.10  Notice, delivery, acceptance, consideration not required.
   A transfer on death deed is effective without any of the following:
   1.  Notice or delivery to or acceptance by the designated beneficiary during the transferor’s life.
   2.  Consideration.
    Sec. 11.  NEW SECTION.  633G.11  Revocation by instrument authorized —— revocation by act not permitted.
   1.  Subject to subsection 2, an instrument is effective to revoke a recorded transfer on death deed, or any part of the deed, only if all of the following apply:
   a.  The instrument is any of the following:
   (1)  A transfer on death deed that revokes the deed or part of the deed expressly or by inconsistency.
   (2)  An instrument of revocation that expressly revokes the deed or part of the deed.
   (3)  An inter vivos deed that expressly revokes the transfer on death deed or part of the deed.
   b.  The instrument is acknowledged by the transferor after the acknowledgment of the deed being revoked and is recorded before the transferor’s death in the public records in the office of the county recorder of the county where the deed is recorded.
   2.  If a transfer on death deed is made by more than one transferor, all of the following apply:
   a.  Revocation by a transferor does not affect the deed as to the interest of another transferor.
   b.  A deed of joint owners is revoked only if the deed is revoked by all of the living joint owners.
   3.  After a transfer on death deed is recorded, the deed cannot be revoked by a revocatory act on the deed.
   4.  This section does not limit the effect of an inter vivos transfer of the property.
    Sec. 12.  NEW SECTION.  633G.12  Effect of transfer on death deed during transferor’s life.
   During a transferor’s life, a transfer on death deed does not do any of the following:
   1.  Affect an interest or right of the transferor or any other owner, including the right to transfer or encumber the property.
   2.  Affect an interest or right of a transferee, even if the transferee has actual or constructive notice of the deed.
   3.  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.
   4.  Affect the transferor’s or designated beneficiary’s eligibility for any form of public assistance.
   5.  Create a legal or equitable interest in favor of the designated beneficiary.
   6.  Subject the property to claims or process of a creditor of the designated beneficiary.
    Sec. 13.  NEW SECTION.  633G.13  Effect of transfer on death deed at transferor’s death.
   1.  Except as otherwise provided in the transfer on death deed, in this section, or in section 633.238, 633.523, or 633.535, upon the death of the transferor, the following rules apply to property that is the subject of a transfer on death deed and owned by the transferor at death:
   a.  Subject to paragraph “b”, the interest in the property is transferred to the designated beneficiary in accordance with the deed.
   b.  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.
   c.  Subject to paragraph “d”, concurrent interests are transferred to the beneficiaries in equal and undivided shares with no right of survivorship.
   d.  If the transferor has identified two or more designated beneficiaries to receive concurrent interests in the property, the share of one which 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.
   2.  Subject to section 558.41, a beneficiary takes the property subject to all conveyances, encumbrances, assignments, contracts, mortgages, liens, and other interests to which the property is subject at the transferor’s death. For purposes of this subsection and section 558.41, the recording of the transfer on death deed is deemed to have occurred at the transferor’s death.
   3.  a.  If a transferor is a joint owner and is survived by one or more other joint owners, the property that is the subject of a transfer on death deed belongs to the surviving joint owner or owners with right of survivorship.
   b.  If a transferor is the last surviving joint owner, the transfer on death deed is effective.
   4.  A transfer on death deed transfers property without covenant or warranty of title even if the deed contains a contrary provision.
    Sec. 14.  NEW SECTION.  633G.14  Disclaimer.
   A beneficiary may disclaim all or part of the beneficiary’s interest as provided by chapter 633E.
    Sec. 15.  NEW SECTION.  633G.15  Liability for creditor claims and statutory allowances.
   1.  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, the estate may enforce the liability against property transferred at the transferor’s death by a transfer on death deed.
   2.  If more than one property is transferred by one or more transfer on death deeds, the liability under subsection 1 is apportioned among the properties in proportion to the net values of the properties at the transferor’s death.
   3.  A proceeding to enforce the liability under this section must be commenced not later than eighteen months after the transferor’s death.
    Sec. 16.  NEW SECTION.  633G.16  Optional form of transfer on death deed.
   The following form may be used to create a transfer on death deed. The other sections of this chapter govern the effect of this or any other instrument used to create a transfer on death deed:
(front of form)
REVOCABLE TRANSFER ON DEATH DEED
NOTICE TO OWNER
   You should carefully read all information on the other side of this form. You may want to consult a lawyer before using this form.
   This form must be recorded before your death, or it will not be effective.
IDENTIFYING INFORMATION
   Owner or owners making this deed
_____________________________                 _________________________
Printed name                 Mailing address
_____________________________                 _________________________
Printed name                 Mailing address
   Legal description of the property
__________________________________________________________
PRIMARY BENEFICIARY
   I designate the following beneficiary if the beneficiary survives me.
_____________________________                 _________________________
Printed name                 Mailing address, if available
ALTERNATE BENEFICIARY – Optional
   If my primary beneficiary does not survive me, I designate the following alternate beneficiary if that beneficiary survives me.
_____________________________                 _________________________
Printed name                 Mailing address, if available
TRANSFER ON DEATH
   At my death, I transfer my interest in the described property to the beneficiaries as designated above.
   Before my death, I have the right to revoke this deed.
SIGNATURE OF OWNER OR OWNERS MAKING THIS DEED
                  Seal, if any
Signature                 Date
_____________________________                 _________________________
                  Seal, if any
Signature                 Date
_____________________________                 _________________________
ACKNOWLEDGMENT
(insert acknowledgment for deed here)
(back of form)
COMMON QUESTIONS ABOUT THE USE OF THIS FORM
   What does the Transfer on Death (TOD) deed do?
   When you die, this deed transfers the described property, subject to any liens or mortgages (or other encumbrances) on the property at your death. Probate is not required. The TOD deed has no effect until you die. You can revoke it at any time. You are also free to transfer the property to someone else during your lifetime. If you do not own any interest in the property when you die, this deed will have no effect.
   How do I make a TOD deed?
   Complete this form. Have it acknowledged before a notary public or other individual authorized by law to take acknowledgments. Record the form in each county where any part of the property is located. The form has no effect unless it is acknowledged and recorded before your death.
   Is the legal description of the property necessary?
   Yes.
   How do I find the legal description of the property?
   This information may be on the deed you received when you became an owner of the property. This information may also be available in the office of the county recorder for the county where the property is located. If you are not absolutely sure, consult a lawyer.
   Can I change my mind before I record the TOD deed?
   Yes. If you have not yet recorded the deed and want to change your mind, simply tear up or otherwise destroy the deed.
   How do I record the TOD deed?
   Take the completed and acknowledged form to the office of the county recorder of the county where the property is located. Follow the instructions given by the county recorder to make the form part of the official property records. If the property is in more than one county, you should record the deed in each county.
   Can I later revoke the TOD deed if I change my mind?
   Yes. You can revoke the TOD deed. No one, including the beneficiaries, can prevent you from revoking the deed.
   How do I revoke the TOD deed after it is recorded?
   There are three ways to revoke a recorded TOD deed: [1] Complete and acknowledge a revocation form, and record it in each county where the property is located. [2] Complete and acknowledge a new TOD deed that disposes of the same property, and record it in each county where the property is located. [3] Transfer the property to someone else during your lifetime by a recorded deed that expressly revokes the TOD deed. You may not revoke the TOD deed by will.
   I am being pressured to complete this form. What should I do?
   Do not complete this form under pressure. Seek help from a trusted family member, friend, or lawyer.
   Do I need to tell the beneficiaries about the TOD deed?
   No, but it is recommended. Secrecy can cause later complications and might make it easier for others to commit fraud.
   I have other questions about this form. What should I do?
   This form is designed to fit some but not all situations. If you have other questions, you are encouraged to consult a lawyer.
    Sec. 17.  NEW SECTION.  633G.17  Optional form of revocation.
   The following form may be used to create an instrument of revocation under this chapter. The other sections of this chapter govern the effect of this or any other instrument used to revoke a transfer on death deed.
(front of form)
REVOCATION OF TRANSFER ON DEATH DEED
NOTICE TO OWNER
   This revocation must be recorded before you die or it will not be effective. This revocation is effective only as to the interests in the property of owners who sign this revocation.
IDENTIFYING INFORMATION
  Owner or owners of property making this revocation
_____________________________                 _________________________
Printed name                 Mailing address
_____________________________                 _________________________
Printed name                 Mailing address
  Legal description of the property  

__________________________________________________________
REVOCATION
  I revoke all my previous transfers of this property by transfer on death deed. 
SIGNATURE OF OWNER OR OWNERS MAKING THIS REVOCATION
                  Seal, if any
Signature                 Date
_____________________________                 _________________________
                  Seal, if any
Signature                 Date
_____________________________                 _________________________
ACKNOWLEDGMENT
(insert acknowledgment here)
(back of form)
COMMON QUESTIONS ABOUT THE USE OF THIS FORM
   How do I use this form to revoke a Transfer on Death (TOD) deed?   Complete this form. Have it acknowledged before a notary public or other individual authorized to take acknowledgments. Record the form in the public records in the office of the county recorder of each county where the property is located. The form must be acknowledged and recorded before your death or it has no effect.   How do I find the legal description of the property?   This information may be on the TOD deed. It may also be available in the office of the county recorder for the county where the property is located. If you are not absolutely sure, consult a lawyer.   How do I record the form?   Take the completed and acknowledged form to the office of the county recorder of the county where the property is located. Follow the instructions given by the county recorder to make the form part of the official property records. If the property is located in more than one county, you should record the form in each county.   I am being pressured to complete this form. What should I do?   Do not complete this form under pressure. Seek help from a trusted family member, friend, or lawyer.   I have other questions about this form. What should I do?   This form is designed to fit some but not all situations. If you have other questions, you are encouraged to consult a lawyer.
    Sec. 18.  NEW SECTION.  633G.18  Uniformity of application and construction.
   In applying and construing this chapter, consideration shall be given to the need to promote uniformity of the law with respect to the subject matter of this chapter among the states that enact it.
    Sec. 19.  NEW SECTION.  633G.19  Relation to Electronic Signatures in Global and National Commerce Act.
   This chapter modifies, limits, and supersedes the federal Electronic Signatures in Global and National Commerce Act, 15 U.S.C. §7001, et seq., but does not modify, limit, or supersede section 101(c) of that Act, 15 U.S.C. §7001(c), or authorize electronic delivery of any of the notices described in section 103(b) of that Act, 15 U.S.C. §7003(b).
    Sec. 20.  Section 331.602, Code 2025, is amended by adding the following new subsection:
   NEW SUBSECTION.  33.  Record a transfer on death deed created pursuant to section 633G.5 or an instrument of revocation authorized by section 633G.11 and presented to the recorder’s office for recording in the same manner as other deeds are recorded. The recorder shall collect a fee under section 331.604 for the recording of the transfer on death deed or instrument of revocation and shall index the transfer on death deed or instrument of revocation in the name of the owner of record of the real property or interest in the real property who executed the transfer on death deed.
    Sec. 21.  Section 633E.12, subsections 6 and 7, Code 2025, are amended to read as follows:
   6.  In the case of a disclaimer of an interest created by a beneficiary designation made which is disclaimed before the time the designation becomes irrevocable, the disclaimer must be delivered to the person making the beneficiary designation.
   7.  In the case of a disclaimer of an interest created by a beneficiary designation made which is disclaimed after the time the designation becomes irrevocable, the disclaimer of an interest in personal property must be delivered to the person obligated to distribute the interest and the disclaimer of an interest in real property must be recorded in the office of the county recorder of the county where the real property that is the subject of the disclaimer is located.
EXPLANATION
The inclusion of this explanation does not constitute agreement with
the explanation’s substance by the members of the general assembly.
   This bill provides that an individual may execute a transfer on death deed which transfers real property outside of probate to one or more beneficiaries effective at the transferor’s death.
   To be valid, a transfer on death deed must contain the essential elements and formalities of a properly recordable inter vivos deed, state that the transfer to the designated beneficiary is to occur at the transferor’s death, and be recorded before the transferor’s death in the office of the county recorder. 
   A transfer on death deed is revocable, even if the deed states that the deed is irrevocable. A transferor may revoke a transfer on death deed by acknowledging and recording an inconsistent transfer on death deed, or an instrument of revocation or inter vivos deed that expressly revokes the deed. 
   A transfer on death dead is nontestamentary, and the capacity required to make or revoke a transfer on death deed is the same capacity required to make a will.
   A transfer on death deed is effective even if the beneficiary does not receive notice or delivery of the deed during the transferor’s lifetime, and even if the transferor does not receive consideration for the deed.
   During the transferor’s lifetime, a transfer on death deed does not affect the transferor’s interest in the property, including the right to transfer or encumber the property, nor does the transfer on death deed create a legal or equitable interest in favor of the designated beneficiary or subject the property to claims of a creditor of the designated beneficiary. If the transferor transfers the property that is the subject of a transfer of death deed before the transferor’s death, the transfer on death deed is of no effect at the death of the transferor. 
   At the death of the transferor, subject to Code sections 633.238 (elective share of surviving spouse), 633.523 (uniform simultaneous death act), and 633.535 (felonious death), the property is transferred to the designated beneficiary if the designated beneficiary is alive. If the designated beneficiary predeceases the transferor, the interest of the designated beneficiary lapses. 
   Subject to Code section 558.41 (recording), a beneficiary who takes property under a transfer on death deed takes the property subject to all conveyances, encumbrances, assignments, contracts, mortgages, liens, and other interests to which the property is subject at the transferor’s death.
   If the transferor owns the property as a joint tenant or as a tenant by the entirety, the transfer on death deed is only effective if the transferor is the last surviving joint tenant or tenant by the entirety.
   A beneficiary may disclaim all or part of the beneficiary’s interest as provided by Code chapter 633E (uniform disclaimer of property interest Act).
   To the extent that 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, the estate may enforce the liability against property transferred at the transferor’s death by a transfer on death deed.
   The bill provides an optional form of a transfer on death deed and an optional form for the revocation of a transfer on death deed.
   The bill does not affect any deed executed and recorded prior to the effective date of the bill and applies to a transfer on death deed made before, on, or after the effective date of the bill by a transferor dying on or after the effective date of the bill. 
   The bill makes conforming changes.