With an Arizona Beneficiary Deed, the owner of real property located in Arizona may convey his or her interest in the property to other people or entities following his or her death. That is, the ownership of the property does not change hands until the Beneficiary Deed takes effect after the original owner passes away. The benefits of a Beneficiary Deed include:
Probate avoidance. Arizona real property transferred by an Arizona Beneficiary Deed avoids the cost (anywhere from $2,500 to $5,000) and delay of an uncontested probate. This is because the property is not part of the deceased person’s probate estate. Avoiding probate in this way is also more economical than doing so through a trust, which typically costs several thousand dollars when drafted by a qualified attorney.
Simplicity. An Arizona Beneficiary Deed is much simpler than creating and administering a trust. In addition, the owner retains complete control over the property with an Arizona Beneficiary Deed.
No gift tax liability. Since an Arizona Beneficiary Deed does not transfer property as a “gift,” it is not subject to gift taxes.
Flexibility. The owner is free to change an Arizona Beneficiary Deed at any time. He or she may sell, encumber or otherwise deal with their property without any restrictions or limitations. In addition, the owner may revoke an Arizona Beneficiary Deed at any time.
While an Arizona Beneficiary Deed has many advantages, it is not for everyone. Certain property owners will be better served by other estate planning tools. Contact us today for more information about Arizona Beneficiary Deeds and to learn whether they are a good option for your specific situation, needs and goals.
FAQs Concerning Arizona Beneficiary Deeds
An estate plan will ensure your assets are distributed to your beneficiaries with the least amount of legal fuss. The beneficiary deed was passed into Arizona state law on Aug. 9, 2001, and is designed to make it easier to transfer your real property to a beneficiary when you die. With some basic estate planning, you can include a beneficiary deed and make life easier for your loved ones. Get in touch with an experienced real estate attorney in Arizona to learn more.
What Is a Beneficiary Deed?
A Beneficiary Deed is sometimes called a transfer-on-death (TOD) deed and is allowed in 23 states, including Arizona. It can be used to transfer an owner’s Arizona property interest to another person upon the property owner’s death.
Why Use a Beneficiary Deed?
It is an easy and inexpensive method of estate planning and can be used by anyone who owns property in the state of Arizona. Without a beneficiary deed in place, there can be a lot of problems when it comes to deciding who is entitled to the property.
Who Can Receive Property Via a Beneficiary Deed?
The person to receive the land is called a grantee. You can name a person who is 18 years of age or older, trust, or entity as a grantee. You can decide upon several grantees that share title as joint tenants with right of survivorship, tenants in common, or any other tenancy form that is legal in the state of Arizona.
When Will a Beneficiary Deed be Ineffective?
There are potential problems if two (or more) people own the property with rights of survivorship. If only one owner creates a beneficiary deed, it might be ineffective. It depends on whether that owner was the first to die.
What Do I Need to Do to Ensure the Beneficiary Deed Is Valid?
A Beneficiary Deed has to be signed by the property owner and notarized, recorded in the county where the property is located during the owner’s lifetime, and must accurately state the property’s legal description.