Transfer on Death Deed in Texas: How It Works and What to Know

A transfer on death deed in Texas lets a property owner name a beneficiary to receive real estate at death, without going through probate. Governed by Texas Estates Code Chapter 114, it is one of two non-probate property transfer tools available to Texas owners, alongside the Lady Bird deed. Baker Law Group, PLLC helps Texas property owners evaluate which instrument fits their estate planning goals and drafts transfer on death deeds that meet every statutory requirement before recording.

This page explains how a Texas transfer on death deed works, what it takes to create a valid one, its benefits and limitations, and how it compares to a Lady Bird deed.

What Is a Transfer on Death Deed in Texas?

A transfer on death deed, also called a TODD or TOD deed, is a recorded legal document that conveys real property to a named beneficiary at the owner’s death. Texas enacted the Texas Real Property Transfer on Death Act in 2015 through Senate Bill 462, now codified at Texas Estates Code Chapter 114. That legislation gave Texas property owners a formal, revocable mechanism to transfer real estate outside of probate.

During the owner’s lifetime, the deed creates no present interest in the beneficiary. The owner retains full title, can sell the property, refinance it, or revoke the deed entirely. None of those actions require the beneficiary’s consent or knowledge.

How to Create a Valid Texas Transfer on Death Deed

Texas Estates Code Section 114.055 sets out three requirements for a transfer on death deed to be legally effective.

Draft the deed correctly. The deed must contain all elements of a recordable deed in Texas: the grantor’s full legal name, a complete and accurate legal description of the property, and the beneficiary’s full name. It must also state clearly that the transfer of the property interest occurs at the transferor’s death, not at the time of signing.

Sign before a notary. The owner must sign the deed in the presence of a notary public. Once signed and notarized, the deed is ready to be recorded. A deed that is signed but not notarized cannot be filed with the county clerk and has no legal effect.

Record the deed before death. The signed and notarized deed must be filed with the county clerk in the county where the property is located, and it must be recorded before the owner dies. Once recorded, the deed becomes part of the public property record. A transfer on death deed that is never recorded has no legal effect, even if it was properly drafted and signed.

The beneficiary does not sign the deed and does not need to know about it during the owner’s lifetime. Still, notifying the beneficiary of the deed’s existence and where the recorded copy is stored will prevent confusion at death.

Benefits of a Transfer on Death Deed in Texas

Probate avoidance. Property covered by a transfer on death deed passes directly to the beneficiary at the owner’s death without court involvement. Texas probate takes time and carries court fees. Bypassing it gives the beneficiary faster access to the property and reduces estate administration costs.

Full owner control during life. The deed does not limit the owner’s authority over the property in any way. The owner can sell, refinance, lease, or use the property freely. The owner can also revoke or replace the deed at any time before death by recording a new deed or a formal revocation instrument with the county clerk.

Medicaid planning compatibility. Because no property interest transfers during the owner’s lifetime, a transfer on death deed generally does not count as a disqualifying asset transfer for Medicaid eligibility. The Texas State Law Library notes in its guide on transferring property after death that transfer on death deeds fall outside the probate estate, which generally places them beyond the reach of the Medicaid Estate Recovery Program. This area involves nuanced rules, so legal guidance is important before relying on this feature.

No ongoing administration. Once recorded, a transfer on death deed requires nothing further. There are no annual filings, no trustee fees, and no administrative obligations. The deed takes effect at death and the property transfer follows automatically.

Common Problems with Transfer on Death Deeds in Texas

Two-year creditor window. This is the most significant limitation to understand before choosing a transfer on death deed. Under Texas Estates Code Section 114.106, if the owner’s probate estate is insufficient to satisfy debts at death, creditors may bring a claim against the property transferred by the TOD deed. That window extends for up to two years after the owner’s death. A transfer on death deed does not fully shield the transferred property from the owner’s creditors.

No warranty of title. Texas Estates Code Section 114.103 provides that a transfer on death deed conveys property without any warranty of title, even if the deed contains language suggesting otherwise. The beneficiary takes the property subject to all mortgages, liens, and encumbrances in place at the time of the owner’s death.

Survivorship requirement. The beneficiary must survive the owner by at least 120 hours, meaning five days, to receive the property. If the beneficiary does not meet that threshold, the transfer lapses under the statute and the property passes through other means.

Title company familiarity. Transfer on death deeds have only been authorized in Texas since 2015. Some title companies are less familiar with their mechanics than with older instruments. This can slow post-death real estate transactions. Working with an attorney who can provide clear documentation of the deed’s legal effect reduces that friction considerably.

Scope limited to the described property. A transfer on death deed covers only the specific property named in it. It does not address bank accounts, investment accounts, other real estate, or personal property.

Outdated beneficiary designations. A transfer on death deed names a specific beneficiary at the time it is recorded. If that beneficiary dies years before the owner and the deed is never updated, the transfer lapses at the owner’s death. The property then falls back into the probate estate, defeating the purpose of the instrument. Reviewing and updating the deed when family circumstances change prevents this outcome.

Drafting and recording errors. The deed must include a legal description that matches the property’s existing county records exactly. A transposed lot number, incorrect plat reference, or missing subdivision name creates a title defect that can block a post-death sale or refinance. Unlike errors caught before signing, a defect in a recorded deed often requires a court proceeding to correct.

Transfer on Death Deed vs. Lady Bird Deed in Texas

Texas property owners frequently compare transfer on death deeds and Lady Bird deeds because both tools accomplish the same core goal: passing real property to a named beneficiary at death while avoiding probate and preserving full owner control during life. In most straightforward situations, either instrument works.

A few meaningful differences exist.

Creditor exposure. A Lady Bird deed does not carry a statutory creditor clawback period comparable to the two-year window under Texas Estates Code Section 114.106. For owners carrying significant debt or anticipating large medical expenses late in life, this is a real practical distinction.

Title warranty. A transfer on death deed expressly conveys property without warranty of title under Section 114.103. A Lady Bird deed is not subject to the same statutory restriction, though the warranty in any given Lady Bird deed still depends on how the document is drafted.

Track record and lender familiarity. Lady Bird deeds have been used in Texas for decades. Transfer on death deeds were introduced in 2015, and some lenders and title companies are less familiar with their mechanics. That familiarity gap can occasionally slow a post-death sale.

For a full breakdown of how a Lady Bird deed works, its filing steps, and when it is the better choice, see our complete guide to Lady Bird deeds in Texas.

When a Transfer on Death Deed Makes Sense, and When It Does Not

A transfer on death deed fits best when:

• You own one piece of Texas real estate and want to pass it to a named beneficiary without probate
• Your estate carries minimal anticipated debt or medical expenses at end of life
• Your family situation is uncomplicated and disputes among beneficiaries are unlikely

It is less appropriate when:

• You carry significant debt or anticipate large end-of-life medical expenses that could trigger a creditor claim against the transferred property
• You need title warranty protections built into the transfer instrument
• Your beneficiaries are minors or individuals who may need structured management of the asset after your death
• You own multiple properties or other complex assets that require coordinated estate planning

In those situations, a Lady Bird deed, a revocable living trust, or a combination of instruments may offer stronger protection.

Talk to a Texas Estate Planning Attorney Before You Record That Deed

A transfer on death deed that is drafted or recorded incorrectly can create title problems that are costly to resolve after the owner’s death. Common mistakes include an inaccurate legal description, missing statutory language, and a deed that was signed but never recorded. These errors are far more complicated to correct after the fact than to avoid from the outset.

Contact Baker Law Group, PLLC to schedule a consultation with a member of our Texas estate planning team.

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