New York homeowners can now name who inherits their real estate at death without sending the property through probate, using a transfer on death deed authorized by Real Property Law § 424, effective July 19, 2024. This is one of the tools covered in the broader guide to New York estate planning. This article explains what the deed does, the formalities that make it valid, how to revoke it, and the limits that catch owners by surprise.
What a transfer on death deed does in New York
A transfer on death deed, sometimes called a TOD deed or beneficiary deed, names a beneficiary who takes title to a specific piece of real property the moment the owner dies. Under Real Property Law § 424, the transfer happens outside probate, so the beneficiary does not need a Surrogate’s Court proceeding to become the owner of that parcel.
The deed is nontestamentary, which means it operates on its own rather than as part of the will. It is also fully revocable, even if the deed itself says otherwise. During the owner’s life the beneficiary has no legal or equitable interest in the property: the owner can sell it, mortgage it, or give it away, and the named beneficiary cannot object or interfere. The deed likewise does not affect the owner’s eligibility for public assistance while the owner is alive, and creditors of the beneficiary cannot reach the property before the owner dies.
Because the beneficiary’s interest is contingent, the beneficiary must outlive the owner to inherit. If the named beneficiary dies first and the deed names no alternate, the gift lapses and the property passes under the owner’s will or by intestacy instead. When two or more beneficiaries are named to share the property, they take equal, undivided shares as tenants in common, with no right of survivorship among them unless the deed says so.
What makes a New York TOD deed valid
Section 424 sets specific formalities, and a deed that misses any one of them does not transfer the property. The witnessing requirement is unusual: most New York deeds do not need witnesses, but a TOD deed must be witnessed like a will.
Prepare a recordable deed
The document must contain the essential elements and formalities of a properly recordable lifetime deed, including a correct legal description of the property. The legal description can usually be found on the deed the owner received when buying the property or through the county clerk’s office.
State that the transfer happens at death
The deed must state that the transfer to the designated beneficiary is to occur at the transferor’s death. This language is what makes it a transfer on death deed rather than an ordinary conveyance.
Sign in front of two witnesses
Under
Real Property Law § 424, the owner must sign the deed in the presence of two witnesses who are present at the same time and who witness the signing.Acknowledge before a notary
The deed must be acknowledged before a notary public, the same acknowledgment used for any other recorded deed.
Record before death
The completed, witnessed, and acknowledged deed must be recorded in the public records of the county clerk’s office in the county where the property sits. If the property spans more than one county, the deed is recorded in each.
The capacity needed to sign or revoke a TOD deed is the same capacity required to make a will. The statute also includes a fill-in statutory form that an owner may use, though any instrument that meets the requirements works.
Revoking or changing a transfer on death deed
A transfer on death deed can be undone at any time while the owner is alive, and no one, including the beneficiary, can prevent the revocation. Section 424 allows revocation only through a recorded instrument, not by tearing up or writing on the recorded deed. Three methods work: recording a new TOD deed that disposes of the same property, recording a separate instrument of revocation, or recording an ordinary lifetime deed that expressly revokes the TOD deed. Each must be acknowledged before a notary and recorded in the county clerk’s office before the owner’s death. A will cannot revoke a recorded TOD deed.
Divorce revokes the deed automatically as to a former spouse. Under Estates, Powers and Trusts Law § 5-1.4, a divorce, annulment, or judicial separation revokes a revocable transfer made to a former spouse, treating that spouse as having died first, and Section 424 applies this rule to transfer on death deeds. Remarrying the same person revives the transfer.
What a transfer on death deed does not do
Avoiding probate is not the same as avoiding debts or taxes. A TOD deed leaves several exposures in place.
The beneficiary receives the property subject to every mortgage, lien, judgment, and other encumbrance in place at the owner’s death, and the deed passes title without any covenant or warranty. The beneficiary inherits the property with its debts attached, not free and clear.
The deed also does not remove the property from the owner’s taxable estate. New York imposes an estate tax on estates above a basic exclusion amount, $7,350,000 for deaths in 2026, and the value of property passing by TOD deed counts toward that total. Estates over the threshold must file a New York estate tax return within nine months of death. The exclusion, rates, and the estate tax “cliff” are covered in New York estate tax. New York does not levy a separate inheritance tax on the person who inherits, a distinction explained in New York inheritance tax versus estate tax.
Joint ownership takes priority over the deed. If the property is held with a right of survivorship, the surviving joint owner takes it first, and the transfer on death deed becomes effective only when the person who signed it is the last surviving owner.
How a TOD deed fits with other New York transfer methods
New York probates wills and administers estates through the Surrogate’s Court in each county. A transfer on death deed keeps the described parcel out of that process entirely, which is its main draw for owners whose largest asset is a home.
A TOD deed differs from a lifetime gift because the owner keeps full control and ownership until death. It differs from adding a child as a joint owner because a joint owner gains an immediate interest, exposes the property to that person’s creditors, and cannot be removed unilaterally, while a TOD beneficiary gains nothing until the owner dies. It differs from a revocable living trust in scope: a trust can hold many assets and manage them during incapacity, while a TOD deed covers one interest in real property and does nothing during the owner’s lifetime. Each of these tools carries different tradeoffs in cost, control, and the range of assets it reaches.
Frequently asked questions
Does a transfer on death deed avoid probate in New York?
Yes, for the property it covers. Real property that passes by a recorded transfer on death deed goes directly to the beneficiary at the owner’s death and does not become part of the probate estate administered in Surrogate’s Court. Other assets that are not covered by the deed or another nonprobate arrangement still pass under the will or by intestacy.
Can I name more than one beneficiary on a TOD deed?
Yes. When a deed names two or more beneficiaries, they take equal, undivided shares as tenants in common, with no right of survivorship among them unless the deed provides otherwise. If one of several beneficiaries dies before the owner, that share passes to the surviving beneficiaries in proportion to their interests under Real Property Law § 424.
What happens if the beneficiary dies before I do?
The beneficiary’s interest is contingent on surviving the owner, so it lapses if the beneficiary dies first. If the deed names an alternate beneficiary, the alternate takes the property. If not, the property passes under the owner’s will or by intestacy.
Does a TOD deed override my will?
For the parcel it covers, yes. A transfer on death deed is nontestamentary and passes the property outside the will, so a gift of the same property in a will does not control. A will cannot revoke a recorded TOD deed; revocation requires a recorded instrument during the owner’s life.
Does the beneficiary take the property free of the mortgage?
No. The beneficiary receives the property subject to every mortgage, lien, and other encumbrance that exists at the owner’s death, and the deed transfers title without warranty. The beneficiary inherits the debt along with the property.